A Reverse Directional Distance Function to Reconcile Between Competing Efficiency Goals: An Application to Indian Manufacturing
In analysis of technical efficiency in production, either the maximum proportional increase in all outputs or a minimal proportional scaling down of all inputs is generally selected as the criterion. In the recent literature, the Directional Distance Function combines the two objectives by increasing output and reducing input simultaneously to the extent possible. This paper introduces a Reverse Directional Distance Function as one possible approach to resolve the conflict between incompatible goals through a minimal adjustment applicable to both of the two objectives. In our empirical analysis we apply the proposed method to Indian manufacturing where increasing the output and conserving energy use are both highly important objectives. A comparison of the feasible targets obtained through the conventional and the Reverse Directional Distance Functions yields an estimated tradeoff between output increase and CO2 reduction (due to energy conservation) along the frontier.
|Date of creation:||Jun 2017|
|Note:||Subhash Ray is the corresponding author|
|Contact details of provider:|| Postal: University of Connecticut 365 Fairfield Way, Unit 1063 Storrs, CT 06269-1063|
Phone: (860) 486-4889
Fax: (860) 486-4463
Web page: http://www.econ.uconn.edu/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Tulkens, Henry & Vanden Eeckaut, Philippe, 1995.
"Non-frontier measures of efficiency, progress and regress for time series data,"
International Journal of Production Economics,
Elsevier, vol. 39(1-2), pages 83-97, April.
- Tulkens, H. & Vanden Eeckaut, P., "undated". "Non-frontier measures of efficiency, progress and regress for time series data," CORE Discussion Papers RP 1159, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Li, Xiao-Bai & Reeves, Gary R., 1999. "A multiple criteria approach to data envelopment analysis," European Journal of Operational Research, Elsevier, vol. 115(3), pages 507-517, June.
- Kumar Mandal, Sabuj & Madheswaran, S., 2010.
"Environmental efficiency of the Indian cement industry: An interstate analysis,"
Elsevier, vol. 38(2), pages 1108-1118, February.
- Sabuj Kumar Mandal & S Madheswaran, 2009. "Environmental Efficiency of the Indian Cement Industry: An Interstate Analysis," Working Papers 227, Institute for Social and Economic Change, Bangalore.
- Aparicio, Juan & Pastor, Jesus T. & Ray, Subhash C., 2013. "An overall measure of technical inefficiency at the firm and at the industry level: The ‘lost profit on outlay’," European Journal of Operational Research, Elsevier, vol. 226(1), pages 154-162.
- Mukherjee, Kankana, 2010. "Measuring energy efficiency in the context of an emerging economy: The case of indian manufacturing," European Journal of Operational Research, Elsevier, vol. 201(3), pages 933-941, March.
- Chambers, Robert G. & Chung, Yangho & Fare, Rolf, 1996. "Benefit and Distance Functions," Journal of Economic Theory, Elsevier, vol. 70(2), pages 407-419, August.
When requesting a correction, please mention this item's handle: RePEc:uct:uconnp:2017-08. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark McConnel)
If references are entirely missing, you can add them using this form.