tailieunhanh - Measurement of Technical Efficiency. A brief survey on parametric and non-parametric techniques - Francesco Porcelli January 2009

This document includes: Measurement of efficiency, Mathematical programming models: the non-parametric approach, Stochastic frontier models: the parametric approach. | Measurement of Technical Efficiency. A brief survey on parametric and non-parametric techniques Francesco Porcelli January 2009 1 Francesco Porcelli - Measurement of Technical Efficiency 2 Contents 1 Measurement of efficiency 3 Koopmans and Debreu-Farrell measure of technical efficiency . 3 Output approach. 4 Input approach. 5 Features of Debreu-Farrell measure of technical efficiency . 6 Measure of allocative efficiency. 7 Techniques for measurement of technical efficiency . 9 2 Mathematical programming models the non-parametric approach 10 DEA one-input one-output model. 10 Multiple input and multiple output model. 10 Model with variable return to scale. 12 Model without strong disposability. 13 Relaxation of the convexity of the output and input set . 14 Stochastic DEA model. 15 3 Stochastic frontier models the parametric approach 16 One-output multiple-input cross-sectional model of technical efficiency. 16 Estimation techniques. 17 One-output multiple-input panel data models of technical efficiency . 19 Fixed effects model. 20 Random effects model. 21 Some problems . 24 References 26 Francesco Porcelli - Measurement of Technical Efficiency 3 1 Measurement of efficiency Following Lovell 1993 the productivity of a production unit can be measured by the ratio of its output to its input. However productivity varies according to differences in production technology production process and differences in the environment in which production occurs. The main interest here is in isolating the efficiency component in order to measure its contribution to productivity. Producers are efficient if they have produced as much as possible with the inputs they have actually employed and if they have produced that output at minimum cost Greene 1997 . It is important however to be aware that efficiency is only one part of the overall performance as reported in Figure 1 a complete analysis .