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Inefficiency
Efficiency is the often measurable ability to avoid wasting materials, energy, efforts, money, and time in doing something or in producing a desired result. In a more general sense, it is the ability to do things well, successfully, and without waste. In more mathematical or scientific terms, it signifies the level of performance that uses the least amount of inputs to achieve the highest amount of output. It often specifically comprises the capability of a specific application of effort to produce a specific outcome with a minimum amount or quantity of waste, expense, or unnecessary effort. Efficiency refers to very different inputs and outputs in different fields and industries. In 2019, the European Commission said: "Resource efficiency means using the Earth's limited resources in a sustainable manner while minimising impacts on the environment. It allows us to create more with less and to deliver greater value with less input." Writer Deborah Stone notes that efficiency is " ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
X-inefficiency
X-inefficiency is the divergence of a firm’s observed behavior in practice, influenced by a lack of competitive pressure, from efficient behavior assumed or implied by economic theory. The concept of X-inefficiency was introduced by Harvey Leibenstein. X-Inefficiency is introduced in 1966 by the professor of Harvard University, Harvey Leibenstein's publication in the ''American Economic Review,'' named "Allocative efficiency vs. X efficiency". X-Inefficiency refer to the firm's production that fails to make full use of its resources, resulting reaches to the maximum possible level of output given the existing resources and environment, namely the efficiency frontier. X-inefficiency pin out irrational actions performed by firms in the market. Overview The difference between the actual and minimum cost of production for a given output produces X-inefficiency. Companies will incur X-Inefficiency as a result of lack of motivation to control its costs, which brings the average c ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
External Cost
In economics, an externality or external cost is an indirect cost or benefit to an uninvolved third party that arises as an effect of another party's (or parties') activity. Externalities can be considered as unpriced goods involved in either consumer or producer market transactions. Air pollution from motor vehicles is one example. The cost of air pollution to society is not paid by either the producers or users of motorized transport to the rest of society. Water pollution from mills and factories is another example. All consumers are all made worse off by pollution but are not compensated by the market for this damage. A positive externality is when an individual's consumption in a market increases the well-being of others, but the individual does not charge the third party for the benefit. The third party is essentially getting a free product. An example of this might be the apartment above a bakery receiving the benefit of enjoyment from smelling fresh pastries every morni ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Productive Efficiency
In microeconomic theory, productive efficiency (or production efficiency) is a situation in which the economy or an economic system (e.g., bank, hospital, industry, country) operating within the constraints of current industrial technology cannot increase production of one good without sacrificing production of another good. In simple terms, the concept is illustrated on a production possibility frontier (PPF), where all points on the curve are points of productive efficiency. An equilibrium may be productively efficient without being allocatively efficient — i.e. it may result in a distribution of goods where social welfare is not maximized (bearing in mind that social welfare is a nebulous objective function subject to political controversy). Productive efficiency is an aspect of economic efficiency that focuses on how to maximize output of a chosen product portfolio, without concern for whether your product portfolio is making goods in the right proportion; in misguided ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Allocative Efficiency
Allocative efficiency is a state of the economy in which production is aligned with consumer preferences; in particular, every good or service is produced up to the point where the last unit provides a marginal benefit to consumers equal to the marginal cost of producing. Description In contract theory, allocative efficiency is achieved in a contract in which the skill demanded by the offering party and the skill of the agreeing party are the same. Resource allocation efficiency includes two aspects: # At the macro aspect, it is the allocation efficiency of social resources, which is achieved through the economic system arrangements of the entire society. # The micro aspect is the use efficiency of resources, which can be understood as the production efficiency of the organization, which can be improved through innovation and progress within the organizations. Although there are different standards of evaluation for the concept of allocative efficiency, the basic principle ass ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Pareto Efficiency
Pareto efficiency or Pareto optimality is a situation where no action or allocation is available that makes one individual better off without making another worse off. The concept is named after Vilfredo Pareto (1848–1923), Italian civil engineer and economist, who used the concept in his studies of economic efficiency and income distribution. The following three concepts are closely related: * Given an initial situation, a Pareto improvement is a new situation where some agents will gain, and no agents will lose. * A situation is called Pareto-dominated if there exists a possible Pareto improvement. * A situation is called Pareto-optimal or Pareto-efficient if no change could lead to improved satisfaction for some agent without some other agent losing or, equivalently, if there is no scope for further Pareto improvement. The Pareto front (also called Pareto frontier or Pareto set) is the set of all Pareto-efficient situations. Pareto originally used the word "optimal" fo ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Data Envelopment Analysis
Data envelopment analysis (DEA) is a nonparametric method in operations research and economics for the estimation of production frontiers.Charnes et al (1978) DEA has been applied in a large range of fields including international banking, economic sustainability, police department operations, and logistical applicationsCharnes et al (1995) Emrouznejad et al (2016)Thanassoulis (1995) Additionally, DEA has been used to assess the performance of natural language processing models, and it has found other applications within machine learning.Zhou et al (2022)Guerrero et al (2022) Description DEA is used to empirically measure productive efficiency of decision-making units (DMUs). Although DEA has a strong link to production theory in economics, the method is also used for benchmarking in operations management, whereby a set of measures is selected to benchmark the performance of manufacturing and service operations. In benchmarking, the efficient DMUs, as defined by DEA, may not n ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Economic Inefficiency
In microeconomics, economic efficiency, depending on the context, is usually one of the following two related concepts: * Allocative or Pareto efficiency: any changes made to assist one person would harm another. * Productive efficiency: no additional output of one good can be obtained without decreasing the output of another good, and production proceeds at the lowest possible average total cost. These definitions are not equivalent: a market or other economic system may be allocatively but not productively efficient, or productively but not allocatively efficient. There are also other definitions and measures. All characterizations of economic efficiency are encompassed by the more general engineering concept that a system is efficient or optimal when it maximizes desired outputs (such as utility) given available inputs. Standards of thought There are two main standards of thought on economic efficiency, which respectively emphasize the distortions created by ''governments'' ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Unemployment Types
Unemployment, according to the OECD (Organisation for Economic Co-operation and Development), is people above a specified age (usually 15) not being in paid employment or self-employment but currently available for work during the reference period. Unemployment is measured by the unemployment rate, which is the number of people who are unemployed as a percentage of the labour force (the total number of people employed added to those unemployed). Unemployment can have many sources, such as the following: * new technologies and inventions * the status of the economy, which can be influenced by a recession * competition caused by globalization and international trade * policies of the government * regulation and market Unemployment and the status of the economy can be influenced by a country through, for example, fiscal policy. Furthermore, the monetary authority of a country, such as the central bank, can influence the availability and cost for money through its monet ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Material
Material is a substance or mixture of substances that constitutes an object. Materials can be pure or impure, living or non-living matter. Materials can be classified on the basis of their physical and chemical properties, or on their geological origin or biological function. Materials science is the study of materials, their properties and their applications. Raw materials can be processed in different ways to influence their properties, by purification, shaping or the introduction of other materials. New materials can be produced from raw materials by synthesis. In industry, materials are inputs to manufacturing processes to produce products or more complex materials. Historical elements Materials chart the history of humanity. The system of the three prehistoric ages ( Stone Age, Bronze Age, Iron Age) were succeeded by historical ages: steel age in the 19th century, polymer age in the middle of the following century (plastic age) and silicon age in the second half o ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Structural Unemployment
Structural unemployment is a form of involuntary unemployment caused by a mismatch between the skills that workers in the economy can offer, and the skills demanded of workers by employers (also known as the skills gap). Structural unemployment is often brought about by technological changes that make the job skills of many workers obsolete. Structural unemployment is one of three categories of unemployment distinguished by economists, the others being frictional unemployment and cyclical unemployment. Because it requires either migration or re-training, structural unemployment can be long-term and slow to fix. Causes and examples From an individual perspective, structural unemployment can be due to: * Inability to afford or decision not to pursue further education or job training. * Choice of a field of study which did not produce marketable job skills. * Inability to afford relocation. * Inability to relocate due to inability to sell a house (for example due to the coll ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Bureaucratic Inertia
Bureaucratic inertia is the supposed inevitable tendency of bureaucratic organizations to perpetuate the established procedures and modes, even if they are counterproductive and/or diametrically opposed to established organizational goals. This unchecked growth may continue independently of the organization's success or failure. Through bureaucratic inertia, organizations tend to take on a life of their own beyond their formal objectives. Examples Government The United States Department of Agriculture has offices in almost all U.S. counties, even though only 14% of counties have valid farms or existing agricultural relevancy. Business The Boston Consulting Group Boston Consulting Group, Inc. (BCG) is an American global management consulting firm founded in 1963 and headquartered in Boston, Massachusetts. It is one of the Big Three (or MBB, the world’s three largest management consulting firms by re ... has advised firms to cut down on bureaucratic inertia and advised firm ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Consumables
Consumables (also known as consumable goods, non-durable goods, or soft goods) are goods that are intended to be consumed. People have, for example, always consumed food and water. Consumables are in contrast to durable goods. Disposable products are a particular, extreme case of consumables, because their end-of-life is reached after a single use. Consumables are products that consumers use ''recurrently'', i.e., items which "get used up" or discarded. For example consumable office supplies are such products as paper, pens, file folders, Post-it notes, and toner or ink cartridges. This is in contrast to capital goods or durable goods in the office, such as computers, fax machines, and other business machines or office furniture. Sometimes a company sells a durable good at an attractively low price in the hopes that the consumer will then buy the consumables that go with it at a price providing a higher margin. Printers and ink cartridges are an example, as are cameras and fil ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
