Static Efficiency Decompositions and Capacity Utilisation: Integrating Economic and Technical Capacity Notions

Ignace Van de Woestyne (), Kristiaan Kerstens, Diego Prior and Bruno De Borger
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Ignace Van de Woestyne: Hogeschool-Universiteit Brussel (HUB), Belgium

No 2009/30, Working Papers from Hogeschool-Universiteit Brussel, Faculteit Economie en Management

Abstract: Starting from existing static decompositions of overall economic efficiency on non-parametric production and cost frontiers, this paper proposes more comprehensive decompositions including several cost-based notions of capacity utilisation. Furthermore, in case prices are lacking, we develop additional decompositions of overall technical efficiency integrating a technical concept of capacity utilisation. These new efficiency decompositions provide a link between short and long run economic analysis and, in empirical work, avoid conflating inefficiency and differences in capacity utilisation. An empirical analysis using a monthly panel of Chilean hydro-electric power plants illustrates the potential of these decomposition proposals.

Keywords: efficiency; capacity utilisation (search for similar items in EconPapers)
Pages: 30 page
Date: 2009-03
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Related works:
Journal Article: Static efficiency decompositions and capacity utilization: integrating economic and technical capacity notions (2013)
Journal Article: Static efficiency decompositions and capacity utilization: integrating economic and technical capacity notions (2012)
Working Paper: Static efficiency decompositions and capacity utilization: integrating economic and technical capacity notions (2012)
Working Paper: STATIC EFFICIENCY DECOMPOSITIONS AND CAPACITY UTILISATION: INTEGRATING ECONOMIC AND TECHNICAL CAPACITY NOTIONS (2011)
Working Paper: Static efficiency decompositions and capacity utilisation: integrating economic and technical capacity notions (2007)
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