Downsizing, X-Efficiency. and Social Efficiency

A. Pompermaier

Faechergruppe Volkswirtschaftlehre from University of Hamburg, Institute of Economics

Abstract: In this paper a theoretical framework is provided to link firm efficiency to product market competition. In particular x-efficienct is shown to arise to the extent unions directly affect the level of employment. A positive relationship is established between social efficiency and x-efficiency, whereby both are at their lowest level when firms can freely adjust size of the workforce. Finally profits (employment/production) are shown to be not necessarily decreasing (increasing) in the degree of competition.

Keywords: MARKET STRUCTURE; EFFICIENCY; BUSINESS ORGANIZATION (search for similar items in EconPapers)
JEL-codes: D24 D40 (search for similar items in EconPapers)
Pages: 11 pages
Date: 2000
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Persistent link: https://EconPapers.repec.org/RePEc:fth:hambec:110

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