IDEAS home Printed from https://ideas.repec.org/p/qld/uqcepa/193.html
   My bibliography  Save this paper

A Homothetic and Additively Separable Production Frontier

Author

Listed:
  • Antonio Peyrache

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

Abstract

I propose a computationally tractable and simple way of building a technology set that is homothetic and complete additevely separable. This results in a technology which is nonparametric in the graph and has an input isoquant of a constant elasticity of substitution (CES) functional form (not necessarily convex). The method introduced in this paper preserves good discrimination power when the number of inputs is large (thus addressing the curse of dimensionality), while preserving full flexibility in the graph of the technology and the form of scale economies. A numerical simulation is presented to show the drastic improvement in discrimination power compared to other methods. Two empirical illustrations are provided to show the usefulness of the approach.

Suggested Citation

  • Antonio Peyrache, 2024. "A Homothetic and Additively Separable Production Frontier," CEPA Working Papers Series WP012024, School of Economics, University of Queensland, Australia.
    • Handle: RePEc:qld:uqcepa:193
    as

    Download full text from publisher

    File URL: https://economics.uq.edu.au/files/50232/WP012024.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Walter Briec & Kristiaan Kerstens, 2006. "Input, output and graph technical efficiency measures on non-convex FDH models with various scaling laws: An integrated approach based upon implicit enumeration algorithms," TOP: An Official Journal of the Spanish Society of Statistics and Operations Research, Springer;Sociedad de Estadística e Investigación Operativa, vol. 14(1), pages 135-166, June.
    2. Podinovski, V. V., 2004. "On the linearisation of reference technologies for testing returns to scale in FDH models," European Journal of Operational Research, Elsevier, vol. 152(3), pages 800-802, February.
    3. Antonio Peyrache, 2022. "A Homothetic Data Generated Technology," CEPA Working Papers Series WP042022, School of Economics, University of Queensland, Australia.
    4. Peyrache, Antonio & Rose, Christiern & Sicilia, Gabriela, 2020. "Variable selection in Data Envelopment Analysis," European Journal of Operational Research, Elsevier, vol. 282(2), pages 644-659.
    5. Peyrache, Antonio & Zago, Angelo, 2016. "Large courts, small justice!," Omega, Elsevier, vol. 64(C), pages 42-56.
    6. Timothy J. Coelli & D.S. Prasada Rao & Christopher J. O’Donnell & George E. Battese, 2005. "An Introduction to Efficiency and Productivity Analysis," Springer Books, Springer, edition 0, number 978-0-387-25895-9, October.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Antonio Peyrache, 2022. "A Homothetic Data Generated Technology," CEPA Working Papers Series WP042022, School of Economics, University of Queensland, Australia.
    2. Peyrache, Antonio, 2024. "A homothetic data generated technology," European Journal of Operational Research, Elsevier, vol. 316(1), pages 255-267.
    3. Kristiaan Kerstens & Ignace Van de Woestyne, 2018. "Enumeration algorithms for FDH directional distance functions under different returns to scale assumptions," Annals of Operations Research, Springer, vol. 271(2), pages 1067-1078, December.
    4. Xiaoqing Chen & Kristiaan Kerstens & Qingyuan Zhu, 2021. "Exploring Horizontal Mergers in Swedish District Courts Using Convex and Nonconvex Technologies: Usefulness of a Conservative Approach," Working Papers 2021-EQM-05, IESEG School of Management.
    5. Grammatoula Papaioannou & Victor V. Podinovski, 2025. "Free disposal hull models of multicomponent technologies," Annals of Operations Research, Springer, vol. 351(2), pages 1559-1587, August.
    6. Antonio Peyrache & Maria C. A. Silva, 2022. "A Comment on Decomposition of Efficiency in Network Production Models," CEPA Working Papers Series WP072022, School of Economics, University of Queensland, Australia.
    7. Peyrache, Antonio & Silva, Maria C.A., 2024. "The decomposition of efficiency in parallel network production models," Omega, Elsevier, vol. 127(C).
    8. Tavakoli, Ibrahim M. & Mostafaee, Amin, 2019. "Free disposal hull efficiency scores of units with network structures," European Journal of Operational Research, Elsevier, vol. 277(3), pages 1027-1036.
    9. Soleimani-damaneh, Majid & Mostafaee, Amin, 2015. "Identification of the anchor points in FDH models," European Journal of Operational Research, Elsevier, vol. 246(3), pages 936-943.
    10. Antonio Peyrache, 2024. "Homothetic Data Generated Production Metatechnologies," CEPA Working Papers Series WP022024, School of Economics, University of Queensland, Australia.
    11. Sila Mishra, 2023. "‘Cyclic syndrome’ of arrears and efficiency of Indian judiciary," SN Business & Economics, Springer, vol. 3(1), pages 1-27, January.
    12. Veneranda Vedastus Lufano & Dr. Gabriel Kirori & Dr. Rose Mugiira, 2023. "Efficiency Analysis of the Food and Beverage Industry in Tanzania: A Comparative Analysis," International Journal of Economics, IPRJB, vol. 8(2), pages 19-32.
    13. Lundgren, Tommy & Marklund, Per-Olov & Zhang, Shanshan, 2016. "Industrial energy demand and energy efficiency – Evidence from Sweden," Resource and Energy Economics, Elsevier, vol. 43(C), pages 130-152.
    14. Helmi Hammami & Thanh Ngo & David Tripe & Dinh-Tri Vo, 2022. "Ranking with a Euclidean common set of weights in data envelopment analysis: with application to the Eurozone banking sector," Annals of Operations Research, Springer, vol. 311(2), pages 675-694, April.
    15. Jiaqiang Sun & Anita Binti Rosli & Adrian Daud, 2025. "Efficiency analysis of listed pharmaceutical companies in China: A method combining three-stage DEA with undesirable output, PCA, and tobit regression," PLOS ONE, Public Library of Science, vol. 20(8), pages 1-33, August.
    16. Roussey, Ludivine & Soubeyran, Raphael, 2018. "Overburdened judges," International Review of Law and Economics, Elsevier, vol. 55(C), pages 21-32.
    17. Kox, Henk L.M. & Leeuwen, George van & Wiel, Henry van der, 2010. "Competitive, but too small - productivity and entry-exit determinants in European business services," MPRA Paper 24389, University Library of Munich, Germany.
    18. Silvia Saravia-Matus & T. S. Amjath-Babu & Sreejith Aravindakshan & Stefan Sieber & Jimmy A. Saravia & Sergio Gomez y Paloma, 2021. "Can Enhancing Efficiency Promote the Economic Viability of Smallholder Farmers? A Case of Sierra Leone," Sustainability, MDPI, vol. 13(8), pages 1-17, April.
    19. Norman Gemmell & Patrick Nolan & Grant Scobie, 2017. "Public sector productivity: Quality adjusting sector-level data on New Zealand schools," Working Papers 2017/02, New Zealand Productivity Commission.
    20. Kangile, Rajabu Joseph, 2015. "Efficiency In Production By Smallholder Rice Farmers Under Cooperative Irrigation Schemes In Pwani And Morogoro Regions, Tanzania," Research Theses 265681, Collaborative Masters Program in Agricultural and Applied Economics.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:qld:uqcepa:193. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SOE IT (email available below). General contact details of provider: https://edirc.repec.org/data/decuqau.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.