Inefficiency Measurement-Reference-Cited by-同舟云学术

Inefficiency Measurement

Published:2014-05-01 Issue:2 Volume:6 Page:79-92
ISSN:1945-7669
Container-title:American Economic Journal: Microeconomics
language:en
Short-container-title:American Economic Journal: Microeconomics

Author:

Chambers Christopher P.¹,Miller Alan D.²

Affiliation:

1. Department of Economics, University of California, San Diego, 9500 Gilman Drive, #0508, La Jolla, CA 92093 (e-mail: )

2. Faculty of Law and Department of Economics, University of Haifa, Mount Carmel, Haifa, 31905, Israel (e-mail: )

Abstract

We introduce an ordinal model of efficiency measurement. Our primitive is a notion of efficiency that is comparative, but not cardinal or absolute. In this framework, we postulate axioms that an ordinal efficiency measure should satisfy. Primary among these are choice consistency and planning consistency, which guide the measurement of efficiency in a firm with access to multiple technologies. Other axioms include scale invariance, strong monotonicity, and a continuity condition. These axioms characterize a family of path-based measures. By replacing the continuity condition with symmetry, we obtain the coefficient of resource utilization. (JEL D24, D60)

Publisher

American Economic Association

Subject

General Economics, Econometrics and Finance

Link

https://pubs.aeaweb.org/doi/pdf/10.1257/mic.6.2.79

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