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On the Functional Form of an Efficiency Index

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  • Jens Hougaard
  • Hans Keiding

Abstract

An input efficiency index gives a numeric assessment of the degree to which a given input combination falls short of being efficient in producing a fixed amount of output. This paper presents a system of axioms which characterise a certain family of efficiency indices containing the well-known Farrell and Färe-Lovell indices. The family of indices satisfying the axioms can be obtained by minimizing a suitable function, called a performance evaluation, and different choices of performance evaluation will result in different indices. Copyright Kluwer Academic Publishers 1998

Suggested Citation

  • Jens Hougaard & Hans Keiding, 1998. "On the Functional Form of an Efficiency Index," Journal of Productivity Analysis, Springer, vol. 9(2), pages 103-111, March.
    • Handle: RePEc:kap:jproda:v:9:y:1998:i:2:p:103-111
    DOI: 10.1023/A:1018342231742
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    References listed on IDEAS

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    1. Dmitruk, Andrei V. & Koshevoy, Gleb A., 1991. "On the existence of a technical efficiency criterion," Journal of Economic Theory, Elsevier, vol. 55(1), pages 121-144, October.
    2. Bol, Georg, 1986. "On technical efficiency measures: A remark," Journal of Economic Theory, Elsevier, vol. 38(2), pages 380-385, April.
    3. Zieschang, Kimberly D., 1984. "An extended farrell technical efficiency measure," Journal of Economic Theory, Elsevier, vol. 33(2), pages 387-396, August.
    4. Fare, Rolf & Knox Lovell, C. A., 1978. "Measuring the technical efficiency of production," Journal of Economic Theory, Elsevier, vol. 19(1), pages 150-162, October.
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    Cited by:

    1. Robert G. Chambers, 2023. "Path-based set representations," Journal of Productivity Analysis, Springer, vol. 60(3), pages 249-256, December.
    2. Hougaard, Jens Leth & Tvede, Mich, 2002. "Benchmark selection: An axiomatic approach," European Journal of Operational Research, Elsevier, vol. 137(1), pages 218-228, February.
    3. Domenico Moramarco & François Maniquet, 2022. "On the measurement of well-being with reference consumption," Working Papers 629, ECINEQ, Society for the Study of Economic Inequality.
    4. Fukuyama, Hirofumi & Maeda, Yasunobu & Sekitani, Kazuyuki & Shi, Jianming, 2014. "Input–output substitutability and strongly monotonic p-norm least distance DEA measures," European Journal of Operational Research, Elsevier, vol. 237(3), pages 997-1007.
    5. Chambers, Christopher P. & Ye, Siming, 2024. "Haves and have-nots: A theory of economic sufficientarianism," Journal of Economic Theory, Elsevier, vol. 217(C).
    6. Mette Asmild & Tomas Baležentis & Jens Leth Hougaard, 2016. "Multi-directional productivity change: MEA-Malmquist," Journal of Productivity Analysis, Springer, vol. 46(2), pages 109-119, December.
    7. François Maniquet & Domenico Moramarco, 2022. "On the Measurement of Well-Being with Reference Consumption," Working Papers ECARES 2022-41, ULB -- Universite Libre de Bruxelles.
    8. Christopher P. Chambers & Alan D. Miller, 2023. "Multiple Adjusted Quantiles," Papers 2305.06354, arXiv.org.
    9. Mojtaba Ghiyasi & Jens Leth Hougaard, 2014. "Ranking Production Units According to Marginal Efficiency Contribution," MSAP Working Paper Series 04_2014, University of Copenhagen, Department of Food and Resource Economics.
    10. Chambers, Christopher P. & Miller, Alan D., 2018. "Benchmarking," Theoretical Economics, Econometric Society, vol. 13(2), May.
    11. Chambers, Christopher P. & Miller, Alan D., 2014. "Scholarly influence," Journal of Economic Theory, Elsevier, vol. 151(C), pages 571-583.
    12. Fleurbaey, Marc & Maniquet, François, 2017. "Addendum to “Fairness and well-being measurement”," Mathematical Social Sciences, Elsevier, vol. 90(C), pages 127-128.
    13. Christensen, Flemming & Hougaard, Jens Leth & Keiding, Hans, 1999. "An axiomatic characterization of efficiency indices," Economics Letters, Elsevier, vol. 63(1), pages 33-37, April.
    14. Banerjee, Kuntal & Mitra, Tapan, 2018. "On Wold’s approach to representation of preferences," Journal of Mathematical Economics, Elsevier, vol. 79(C), pages 65-74.

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