The role of multiplier bounds in efficiency analysis with application to Kansas farming

Abstract

As long recognized, the problem of efficiency involves both technical and economic facets. Determination of the technically efficient firms provides the base for economic analysis. Values in terms of prices or costs must be introduced into the problem to work towards finding firms which might be regarded as overall efficient. That problem came to the forefront in a 1984 study to find the best site for location of a Superconducting Super Collider (SSC) in the state of Texas. Application of a modern value-free frontier method called Data Envelopment Analysis (DEA) to the data, which was primarily engineering and geological in character, showed five of the six feasible sites were technically ef..