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Weak Disposability in Nonparametric Production Analysis: Reply to Färe and Grosskopf

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  • Timo Kuosmanen
  • Victor Podinovski

Abstract

Färe and Grosskopf (this issue) claim that a single abatement factor suffices for modeling weak disposability in nonparametric production models, and that the Kuosmanen (2005) technology that uses multiple abatement factors is larger than necessary. This article demonstrates by a numerical example that a single abatement factor does not suffice to capture all feasible production plans, and that its use leads to the violation of convexity, one of the maintained assumptions of the model. We also prove that the Kuosmanen technology is the correct minimum extrapolation technology under the stated axioms. Copyright 2008, Oxford University Press.

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  • Timo Kuosmanen & Victor Podinovski, 2008. "Weak Disposability in Nonparametric Production Analysis: Reply to Färe and Grosskopf," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 91(2), pages 539-545.
    • Handle: RePEc:oup:ajagec:v:91:y:2008:i:2:p:539-545
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    File URL: http://hdl.handle.net/10.1111/j.1467-8276.2008.01238.x
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