Efficiency measurement with a non-convex free disposal hull technology

Hirofumi Fukuyama; Jens Leth Hougaard; Kazuyuki  Sekitani; Jianming Shi

doi:10.1057/jors.2015.41

Efficiency measurement with a non-convex free disposal hull technology

Hirofumi Fukuyama, Jens Leth Hougaard, Kazuyuki Sekitani, Jianming Shi

Section for Production, Markets and Policy

17 Citations (Scopus)

Abstract

We investigate the basic monotonicity properties of least-distance (in)efficiency measures on the class of non-convex FDH (free disposable hull) technologies. We show that any known FDH least-distance measure violates strong monotonicity over the strongly (Pareto-Koopmans) efficient frontier. Taking this result into account, we develop a new class of FDH least-distance measures that satisfy strong monotonicity and show that the developed (in)efficiency measurement framework has a natural profit interpretation.

Original language	English
Journal	Journal of the Operational Research Society
Volume	67
Issue number	1
Pages (from-to)	9–19
Number of pages	11
ISSN	0160-5682
DOIs	https://doi.org/10.1057/jors.2015.41
Publication status	Published - 1 Jan 2016

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abstract = "We investigate the basic monotonicity properties of least-distance (in)efficiency measures on the class of non-convex FDH (free disposable hull) technologies. We show that any known FDH least-distance measure violates strong monotonicity over the strongly (Pareto-Koopmans) efficient frontier. Taking this result into account, we develop a new class of FDH least-distance measures that satisfy strong monotonicity and show that the developed (in)efficiency measurement framework has a natural profit interpretation.",

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AU - Fukuyama, Hirofumi

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AU - Sekitani, Kazuyuki

AU - Shi, Jianming

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N2 - We investigate the basic monotonicity properties of least-distance (in)efficiency measures on the class of non-convex FDH (free disposable hull) technologies. We show that any known FDH least-distance measure violates strong monotonicity over the strongly (Pareto-Koopmans) efficient frontier. Taking this result into account, we develop a new class of FDH least-distance measures that satisfy strong monotonicity and show that the developed (in)efficiency measurement framework has a natural profit interpretation.

AB - We investigate the basic monotonicity properties of least-distance (in)efficiency measures on the class of non-convex FDH (free disposable hull) technologies. We show that any known FDH least-distance measure violates strong monotonicity over the strongly (Pareto-Koopmans) efficient frontier. Taking this result into account, we develop a new class of FDH least-distance measures that satisfy strong monotonicity and show that the developed (in)efficiency measurement framework has a natural profit interpretation.

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Efficiency measurement with a non-convex free disposal hull technology

Abstract

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