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Aggregation of Nerlovian profit indicator


  • Rolf Fare
  • Shawna Grosskopf
  • Valentin Zelenyuk


This note shows that the Nerlovian profit indicator may be aggregated over firms into an industry measure of profit efficiency. The note also provides conditions under which the technical component of the indicator may also be aggregated.

Suggested Citation

  • Rolf Fare & Shawna Grosskopf & Valentin Zelenyuk, 2008. "Aggregation of Nerlovian profit indicator," Applied Economics Letters, Taylor & Francis Journals, vol. 15(11), pages 845-847.
  • Handle: RePEc:taf:apeclt:v:15:y:2008:i:11:p:845-847 DOI: 10.1080/13504850600825584

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    References listed on IDEAS

    1. Edward L. Glaeser & Andrei Shleifer, 2003. "The Rise of the Regulatory State," Journal of Economic Literature, American Economic Association, vol. 41(2), pages 401-425, June.
    2. Duso, Tomaso & Roller, Lars-Hendrik, 2003. "Endogenous deregulation: evidence from OECD countries," Economics Letters, Elsevier, vol. 81(1), pages 67-71, October.
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    4. repec:hrv:faseco:30747197 is not listed on IDEAS
    5. Tomaso Duso, 2005. "Lobbying and regulation in a political economy: Evidence from the U.S. cellular industry," Public Choice, Springer, vol. 122(3), pages 251-276, March.
    6. Dutz, Mark & Hayri, Aydin, 1999. "Does More Intense Competition Lead to Higher Growth?," CEPR Discussion Papers 2249, C.E.P.R. Discussion Papers.
    7. Robert E. Hall & Charles I. Jones, 1999. "Why do Some Countries Produce So Much More Output Per Worker than Others?," The Quarterly Journal of Economics, Oxford University Press, vol. 114(1), pages 83-116.
    8. Ai, Chunrong & Sappington, David E M, 2002. "The Impact of State Incentive Regulation on the U.S. Telecommunications Industry," Journal of Regulatory Economics, Springer, vol. 22(2), pages 133-159, September.
    9. Besley, Timothy & Case, Anne, 2000. "Unnatural Experiments? Estimating the Incidence of Endogenous Policies," Economic Journal, Royal Economic Society, vol. 110(467), pages 672-694, November.
    10. Torsten Persson & Guido Tabellini, 2005. "The Economic Effects of Constitutions," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262661926, July.
    11. Jeffrey A. Frankel & David Romer, 1996. "Trade and Growth: An Empirical Investigation," NBER Working Papers 5476, National Bureau of Economic Research, Inc.
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    Cited by:

    1. Antonio Peyrache & Minyan Zhu, 2013. "The quality and efficiency of public service delivery in the UK and China," CEPA Working Papers Series WP052013, School of Economics, University of Queensland, Australia.
    2. Hien Thu Pham & Antonio Peyrache, 2015. "Industry Inefficiency Measures: A Unifying Approximation Proposition," CEPA Working Papers Series WP102015, School of Economics, University of Queensland, Australia.
    3. Briec, Walter & Comes, Christine & Kerstens, Kristiaan, 2006. "Temporal technical and profit efficiency measurement: Definitions, duality and aggregation results," International Journal of Production Economics, Elsevier, vol. 103(1), pages 48-63, September.
    4. A. Peyrache & Angelo Zago, 2012. "Large Courts, Small Justice! The inefficiency and the optimal structure of the Italian Justice Sector," CEPA Working Papers Series WP062012, School of Economics, University of Queensland, Australia.
    5. Peyrache, Antonio, 2013. "Industry structural inefficiency and potential gains from mergers and break-ups: A comprehensive approach," European Journal of Operational Research, Elsevier, vol. 230(2), pages 422-430.
    6. Peyrache, Antonio, 2015. "Cost constrained industry inefficiency," European Journal of Operational Research, Elsevier, vol. 247(3), pages 996-1002.
    7. Stephane Mussard & Nicolas Peypoch, 2006. "On multi-decomposition of the aggregate Luenberger productivity index," Applied Economics Letters, Taylor & Francis Journals, vol. 13(2), pages 113-116.
    8. Zelenyuk, Valentin, 2006. "Aggregation of Malmquist productivity indexes," European Journal of Operational Research, Elsevier, vol. 174(2), pages 1076-1086, October.
    9. Zelenyuk, Valentin, 2015. "Aggregation of scale efficiency," European Journal of Operational Research, Elsevier, vol. 240(1), pages 269-277.
    10. Briec, Walter & Mussard, St├ęphane, 2014. "Efficient firm groups: Allocative efficiency in cooperative games," European Journal of Operational Research, Elsevier, vol. 239(1), pages 286-296.

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