Multiplicative Duality Theory in Production Economics

28 Pages Posted: 16 Aug 2015

See all articles by Walter Briec

Walter Briec

University of Perpignan

Paola Ravelojaona

ICN Business School

Date Written: August 14, 2015

Abstract

Charnes et al. (1982, 1983) introduced a multiplicative model for efficiency measurement under Data Envelopment Analysis (DEA) framework. Later, Coelli and Peyrach (2009) presented the Multiplicative Directional Distance Function which was recovered by Mehdiloozad et al. (2014) to draw the Generalized Multiplicative Directional Distance Function. In this paper, we propose a general duality framework based upon the so-called Exponential Distance Function endowed with a multiplicative convexity structure. The notion of allocative and overall efficiency are considered from a multiplicative view point. Some non-linear duality results are established. Along this line, a connection to the Cobb-Douglas functional form is proposed.

Keywords: Technical efficiency, Log-convexity, Cobb-Douglas structure, Exponential distance.

JEL Classification: D24

Suggested Citation

Briec, Walter and Ravelojaona, Paola, Multiplicative Duality Theory in Production Economics (August 14, 2015). Available at SSRN: https://ssrn.com/abstract=2644581 or http://dx.doi.org/10.2139/ssrn.2644581

Walter Briec

University of Perpignan ( email )

52, avenue de Villeneuve
Perpignan 66860
France
+33 468662264 (Phone)
+33 468662217 (Fax)

Paola Ravelojaona (Contact Author)

ICN Business School

86 rue Sergent Blandan
Nancy, 54000
France

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