SFB 303 Discussion Paper No. A - 119

Author: Färe, Rolf, and Shawna Grosskopf
Title: On Price Efficiency
Abstract: In this paper, we will shed light on two efficiency notions defined by Atkinson and Halvorsen (1984) by relating them to the dual Farrell-like measures of price efficiency, as introduced by Färe (1984). In particular, if relative price efficiency holds, then and only then is there no allocative inefficiency, and if absolute price efficiency holds, then and only then is there overall (dual) efficiency. Moreover, since the dual Farrell decomposition also involves dual technical efficiency, a third price efficiency notion appears naturally.
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Creation-Date: May 1987
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