A Mathematical Approach for Technology Selection in the Presence of Slightly Non-homogeneous Technologies

The assumption of classical technology selection models is based on complete homogeneity of technologies. In spite of this assumption in many applications some technologies do not comprehensively consume common inputs to comprehensively supply common outputs. The objective of this paper is to propose a model for selecting slightly non-homogeneous technologies. A numerical example demonstrates the application of the proposed method

Profit Efficiency Analysis Under Limited Information. With an Application to German Farm Types

Lack of information about technology and prices often hampers the empirical assessment of the validity of the profit maximization hypothesis. We show that the non-parametric Data Envelopment Analysis (DEA) methodology comprises natural tools for dealing with such incomplete information. In particular, we focus on the economic meaning of the DEA model that builds on assumptions of monotone and convex production possibility sets, and provide some extensions that further exploit this economic interpretation. This perspective on DEA is all the more attractive since its original use for technical efficiency analysis is sometimes questionable given its restrictive production assumptions. An application to German farm types complements our methodological discussion. By using nonparametric tools to test specific hypotheses about profit differences, we further demonstrate the potential of the non-parametric approach in deriving strong and robust statistical evidence while imposing minimal structure on the setting under study.profit maximization hypothesis; Data Envelopment Analysis; non-parametric techniques; agriculture

Profit efficiency analysis under limited information. With an application to German farm types.

Efficiency; Information;