@techreport{ba96f8b7b6ec4d41896ca65107e76cf1,
title = "Superlative approximation of the Luenberger-Hicks-Moorsteen productivity indicator: Theory and application",
abstract = "Consisting of the difference between an output indicator and an input indicator, the Luenberger-Hicks-Moorsteen (LHM) productivity indicator allows straightforward interpretation. However, it requires estimation of distance functions that are inherently unknown. This paper shows that a simple Bennet profit indicator is a superlative approximation of the LHM indicator when one can assume profit-maximizing behavior and the input and output directional distance functions can be represented up to the second order by a quadratic functional form. We also show that the Luenberger and LHM-approximating Bennet indicators coincide for an appropriate choice of the directional vectors. Focusing on a large sample of Italian food and beverages companies for the years 1995-2007, we empirically investigate the extent to which this theoretical equivalence translates into similar estimates.",
author = "Frederic Ang and Kerstens, {Pieter Jan T}",
year = "2018",
language = "English",
series = "IFRO Working Paper",
publisher = "Department of Food and Resource Economics, University of Copenhagen",
number = "2018/10",
type = "WorkingPaper",
institution = "Department of Food and Resource Economics, University of Copenhagen",
}