Technical efficiency in firm games with constant returns to scale and $$\alpha $$ α -returns to scale

Walter Briec, Marc Dubois () and Stéphane Mussard
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Walter Briec: Université de Perpignan
Marc Dubois: Université de Nîmes and CUFR de Mayotte

Annals of Operations Research, 2021, vol. 304, issue 1, No 2, 35-62

Abstract: Abstract Under a technology based on the generalized mean of inputs and outputs with constant returns to scale (CRS), the firms have incentive to merge (in a firm game) in order to improve their technical efficiency. A directional complementarity property in inputs and in outputs is introduced. It is shown that the core of the firm game is non-void whenever the aggregate technology of each coalition exhibits complementarity in outputs and CRS. In the case of $$\alpha $$ α -returns to scale, the firms have incentive to merge (improvement of technical efficiency) when there are both directional complementarity in inputs and in outputs.

Keywords: Cooperative games; Complementarity; Directional distance function; Returns to scale; Technical efficiency; D21; D24 (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (2)

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Working Paper: Technical efficiency in firm games with constant returns to scale and $$\alpha $$-returns to scale (2021)
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DOI: 10.1007/s10479-021-04056-6

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