A General Input Distance Function Based on Opportunity Costs. (18th January 2012)

• Record Type: Journal Article
• Authors: Aparicio, Juan; Pastor, Jesus T.
• Other Names: Wong Wing Keung Academic Editor.
• Is Part Of: Advances in decision sciences. Volume 2011(2011)
• Publication Date: 2012-01-18
• Subjects: Decision making -- Periodicals; Decision making; Electronic journals; Periodicals; 519
• DOI: 10.1155/2011/505241
• Languages: English
• ISSNs: 2090-3359

Abstract

Abstract : There are several distance function definitions in a general production framework, including Data Envelopment Analysis, which can be used to describe the production technology and to define corresponding measures of technical efficiency (notably the Shephard and the directional distance functions). This paper introduces a generalisation of the distance function concept based on the idea of minimizing firm's opportunity cost. We further state a general dual correspondence between the cost function and this new general distance function, which encompasses all previously published duality results. All our results also hold under the assumption that we work in a Data Envelopment Analysis context.