{"title":"Partially Convex Production Technology and Efficiency Measurement","authors":"","doi":"10.1007/s11123-023-00716-w","DOIUrl":null,"url":null,"abstract":"<h3>Abstract</h3> <p>Economists tend to believe that production technology should exhibit increasing returns to scale first and then constant and finally decreasing returns to scale, called regular variable returns to scale (RVRS) in this paper. Further, a special pattern of RVRS production technology when there is only one output is the production function that has an S-shaped curve along any ray of inputs from the origin. In the literature on efficiency analysis, the most frequently used empirical technology is the variable returns to scale (VRS) production technology. Although it exhibits RVRS, it is unable to model nonconvex production technologies, such as the S-shaped production function. Recently, a new empirical production technology has been introduced to capture RVRS with partial convexity. This paper explores its relationship with efficiency measurement. Furthermore, a novel empirical production technology that can better capture the characteristics of the S-shaped production function is proposed. These two new production technologies provide better alternatives to the commonly used Free Disposal Hull (FDH) production technology in non-convex production with RVRS. Our new production technology is illustrated using US manufacturing industry data. If one believes that the production technology is partially convex and exhibits RVRS, it is found that the conventional VRS production technology overestimates the technical inefficiency of small production units under this belief.</p>","PeriodicalId":16870,"journal":{"name":"Journal of Productivity Analysis","volume":"50 1","pages":""},"PeriodicalIF":2.3000,"publicationDate":"2024-01-12","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Journal of Productivity Analysis","FirstCategoryId":"96","ListUrlMain":"https://doi.org/10.1007/s11123-023-00716-w","RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q3","JCRName":"BUSINESS","Score":null,"Total":0}
引用次数: 0
Abstract
Economists tend to believe that production technology should exhibit increasing returns to scale first and then constant and finally decreasing returns to scale, called regular variable returns to scale (RVRS) in this paper. Further, a special pattern of RVRS production technology when there is only one output is the production function that has an S-shaped curve along any ray of inputs from the origin. In the literature on efficiency analysis, the most frequently used empirical technology is the variable returns to scale (VRS) production technology. Although it exhibits RVRS, it is unable to model nonconvex production technologies, such as the S-shaped production function. Recently, a new empirical production technology has been introduced to capture RVRS with partial convexity. This paper explores its relationship with efficiency measurement. Furthermore, a novel empirical production technology that can better capture the characteristics of the S-shaped production function is proposed. These two new production technologies provide better alternatives to the commonly used Free Disposal Hull (FDH) production technology in non-convex production with RVRS. Our new production technology is illustrated using US manufacturing industry data. If one believes that the production technology is partially convex and exhibits RVRS, it is found that the conventional VRS production technology overestimates the technical inefficiency of small production units under this belief.
期刊介绍：
The Journal of Productivity Analysis publishes theoretical and applied research that addresses issues involving the measurement, explanation, and improvement of productivity. The broad scope of the journal encompasses productivity-related developments spanning the disciplines of economics, the management sciences, operations research, and business and public administration. Topics covered in the journal include, but are not limited to, productivity theory, organizational design, index number theory, and related foundations of productivity analysis. The journal also publishes research on computational methods that are employed in productivity analysis, including econometric and mathematical programming techniques, and empirical research based on data at all levels of aggregation, ranging from aggregate macroeconomic data to disaggregate microeconomic data. The empirical research illustrates the application of theory and techniques to the measurement of productivity, and develops implications for the design of managerial strategies and public policy to enhance productivity.
Officially cited as: J Prod Anal
求助内容：
应助结果提醒方式：
京公网安备 11010802042870号
