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Rational Inefficiencies

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  • Peter Bogetoft
  • Jens Hougaard

Abstract

In this paper, we suggest that inefficiency may be an indirect, on-the-job compensation to agents in an organization. We show how to use actual production data to reveal the trade-offs between different inefficiencies (slacks). Moreover, we discuss how to use this to improve productivity analysis as well as decision making and incentive provisions in organizations. Copyright Kluwer Academic Publishers 2003

Suggested Citation

  • Peter Bogetoft & Jens Hougaard, 2003. "Rational Inefficiencies," Journal of Productivity Analysis, Springer, vol. 20(3), pages 243-271, November.
    • Handle: RePEc:kap:jproda:v:20:y:2003:i:3:p:243-271
    DOI: 10.1023/A:1027347616038
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    References listed on IDEAS

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    9. Fare, Rolf & Grosskopf, Shawna, 1995. "Nonparametric tests of regularity, Farrell efficiency, and goodness-of-fit," Journal of Econometrics, Elsevier, vol. 69(2), pages 415-425, October.
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