A large literature exists on measuring the allocative and technical efficiency of a set of firms. A segment of this literature uses data envelopment analysis (DEA), creating relative efficiency rankings that are nonstochastic and thus cannot be evaluated according to the precision of the...

The estimation of allocative and technical inefficiency has grown to an enormous body of literature, both theoretical and empirical. Ideally, one would estimate time-varying firm and input-specific parameters describing allocative inefficiency in order to minimize aggregation bias. However, this...

Many production activities generate undesirable outputs in conjunction with the desirable outputs. In this paper we present the first estimates of a multiple-input, multiple-output directional distance function that relates good and bad inputs from home, school, and environment to good and bad...

Econometric models to estimate allocative and technical inefficiency include stochastic shadow distance frontiers, shadow cost frontiers, and shadow profit frontiers. In these models, the cost savings from eliminating both sources of inefficiency is often reported in total and then decomposed...