Productive Efficiency Analysis with Incomplete Output Information

Laurens Cherchye, Bram De Rock, Dieter Saelens and Marijn Verschelde

No 2022-21, Working Papers ECARES from ULB -- Universite Libre de Bruxelles

Abstract: We present a novel DEA-type method to evaluate the productive efficiency of DMUs when the empirical analyst has incomplete output information. Our method builds on the Afriat Theorem that was originally proposed in the context of consumer analysis. We translate this result to a production setting and show that it provides a productive basis for cost efficiency analysis in the absence of output information. Our method is versatile in that it can accommodate a continuum of instances characterized by incomplete information on output quantities. We illustrate its practical usefulnessthrough an empirical application that evaluates the productive efficiency performance of countries.

Keywords: efficiency measurement; nonparametric production analysis; incomplete output information; Afriat Theorem (search for similar items in EconPapers)
Pages: 18 p.
Date: 2022-06
New Economics Papers: this item is included in nep-eff
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Journal Article: Productive efficiency analysis with incomplete output information (2024)
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