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Metric Distance Function and Profit: Some Duality Results

Author

Listed:
  • W. Briec

    (Université de Rennes 1)

  • J. B. Lesourd

    (Groupement de Recherche en Economis Quantitative d'Aix-Marseille II)

Abstract

In this paper, we intend to establish relations between the way efficiency is measured in the literature on efficiency analysis and the notion of distance in topology. To this effect, we are interested particularly in the Hölder norm concept, providing a duality result based upon the profit function. Along this line, we prove that the Luenberger shortage function and the directional distance function of Chambers, Chung, and Färe appear as special cases of some l p distance (also called Hölder distance), under the assumption that the production set is convex. Under a weaker assumption (convexity of the input correspondence), we derive a duality result based on the cost function, providing several examples in which the functional form of the production set is specified.

Suggested Citation

  • W. Briec & J. B. Lesourd, 1999. "Metric Distance Function and Profit: Some Duality Results," Journal of Optimization Theory and Applications, Springer, vol. 101(1), pages 15-33, April.
    • Handle: RePEc:spr:joptap:v:101:y:1999:i:1:d:10.1023_a:1021762809393
    DOI: 10.1023/A:1021762809393
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    References listed on IDEAS

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    1. Fuss, Melvyn & McFadden, Daniel, 1978. "Production Economics: A Dual Approach to Theory and Applications (II): Applications of the Theory of Production," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, volume 2, number fuss1978a.
    2. W. Briec, 1997. "A Graph-Type Extension of Farrell Technical Efficiency Measure," Journal of Productivity Analysis, Springer, vol. 8(1), pages 95-110, March.
    3. R. G. Chambers & Y. Chung & R. Färe, 1998. "Profit, Directional Distance Functions, and Nerlovian Efficiency," Journal of Optimization Theory and Applications, Springer, vol. 98(2), pages 351-364, August.
    4. Luenberger, David G., 1992. "Benefit functions and duality," Journal of Mathematical Economics, Elsevier, vol. 21(5), pages 461-481.
    5. Robert Russell, R., 1990. "Continuity of measures of technical efficiency," Journal of Economic Theory, Elsevier, vol. 51(2), pages 255-267, August.
    6. W. Briec, 1997. "Minimum Distance to the Complement of a Convex Set: Duality Result," Journal of Optimization Theory and Applications, Springer, vol. 93(2), pages 301-319, May.
    7. Fuss, Melvyn & McFadden, Daniel, 1978. "Production Economics: A Dual Approach to Theory and Applications (I): The Theory of Production," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, volume 1, number fuss1978.
    8. Chambers, Robert G. & Chung, Yangho & Fare, Rolf, 1996. "Benefit and Distance Functions," Journal of Economic Theory, Elsevier, vol. 70(2), pages 407-419, August.
    Full references (including those not matched with items on IDEAS)

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