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Aggregation of Efficiency and Productivity: From Firm to Sector and Higher Levels

In: Handbook of Production Economics

Author

Listed:
  • Valentin Zelenyuk

    (School of Economics and Centre for Efficiency and Productivity Analysis (CEPA) at The University of Queensland)

Abstract

Here we consider various cases where researchers are interested in measuring aggregate efficiency or productivity levels or their changes for a group of decision making units. These could be entire industry composed of individual firms, banks, hospitals, or a region composed of sub-regions or countries, or particular sub-groups of these units within a group, e.g., sub-groups of public vs. private or regulated vs. non-regulated firms, banks or hospitals within the same industry, etc. Such analysis requires solutions to the aggregation problem—some theoretically justified approaches that can connect individual measures to aggregate measures. Various solutions are offered in the literature and our goal is to try to coherently summarize at least some of them in this chapter. This material should be interesting not only for theorists but also (and perhaps more so) for applied researchers, as it provides exact formulas and intuitive explanations for various measures of group efficiency, group scale elasticity and group productivity indexes and refers to original papers for more details.

Suggested Citation

  • Valentin Zelenyuk, 2022. "Aggregation of Efficiency and Productivity: From Firm to Sector and Higher Levels," Springer Books, in: Subhash C. Ray & Robert G. Chambers & Subal C. Kumbhakar (ed.), Handbook of Production Economics, chapter 25, pages 1039-1079, Springer.
    • Handle: RePEc:spr:sprchp:978-981-10-3455-8_19
    DOI: 10.1007/978-981-10-3455-8_19
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    Cited by:

    1. Valentin Zelenyuk & Valentyn Panchenko, 2024. "Generalized theory for measuring efficiency of individuals and groups," Annals of Operations Research, Springer, vol. 332(1), pages 781-806, January.
    2. Valentin Zelenyuk, 2024. "Aggregation in efficiency and productivity analysis: a brief review with new insights and justifications for constant returns to scale," Journal of Productivity Analysis, Springer, vol. 62(3), pages 321-334, December.
    3. Valentin Zelenyuk, 2026. "Estimation and inference for aggregate productivity and efficiency measures: brief overview and reminiscences," Journal of Productivity Analysis, Springer, vol. 65(2), pages 1-9, June.
    4. Ali Homayoni & Reza Fallahnejad & Farhad Hosseinzadeh Lotfi, 2022. "Cross Malmquist Productivity Index in Data Envelopment Analysis," 4OR, Springer, vol. 20(4), pages 567-602, December.

    More about this item

    Keywords

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    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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