Return to Dollar, Generalized Distance Function and the Fisher Productivity Index
AbstractExploring the duality between a return to dollar definition of profit and the generalized distance function we establish the relationship between the Laspeyres, Paasche and Fisher productivity indexes and their alternative Malmquist indexes counterparts. By proceeding this way, we propose a consistent decomposition of these productivity indexes into two mutually exclusive components. A technical component represented by the Malmquist index and an economical component which can be identified with the contribution that allocative criteria make to productivity change. With regard to the Fisher index, we indicate how researchers can further decompose the Malmquist technical component rendering explicit the sources of productivity change. We also show how the proposed model can be implemented by means of Data Envelopment Analysis techniques, and illustrate the empirical process with an example data set.
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Bibliographic InfoPaper provided by Universidad Autónoma de Madrid (Spain), Department of Economic Analysis (Economic Theory and Economic History) in its series Working Papers in Economic Theory with number 2005/01.
Length: 30 pages
Date of creation: Dec 2005
Date of revision:
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Web page: http://www.uam.es/departamentos/economicas/analecon/default.html
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Generalized Distance Function; Return to Dollar; Fisher and Malmquist Productivity Indexes;
Other versions of this item:
- José Zofío & Angel Prieto, 2006. "Return to Dollar, Generalized Distance Function and the Fisher Productivity Index," Spanish Economic Review, Springer, vol. 8(2), pages 113-138, June.
- C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation
- C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
- D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
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