We study allocative inefficiency under monopoly using a two-good general-equilibrium monopoly production model. Individuals are heterogeneous with respect to preferences. We compare social welfare under monopoly with welfare under perfect competition. We then apply this model to the antidepressant and antipsychotic pharmaceutical markets. We find that, for nine specific drugs, annual social-wel...

This paper specifies an empirical framework for estimating both technical and allocative efficiency, which is applied to a large panel of European banks over the years 1996 2003. Our methodology allows self-consistent measurement inefficiency, in effort address issue known literature as Greene problem. The results suggest that, on average, exhibit constant returns scale, that efficiency are clo...

Traditionally, downside risk aversion is the study of the placement of a pure risk (a secondary risk) on either the upside or the downside of a primary two-state risk. When the decision maker prefers to have the secondary risk placed on the upside rather than the downside of the primary lottery, he is said to display downside risk aversion. The literature on the intensity of downside risk avers...

This research paper investigates the cost efficiency and productivity of TEVETA institutes in Punjab, Pakistan using Data Envelopment Analysis (DEA) COST MALMQUIST INDEX. The study uses data from 2006-2018 to analyze impact reform 2011. objective is assess on production process. results indicate that reforms implemented Punjab have had a positive productivity. change, scale technical change all...

We introduce this special issue on Economic Policy Uncertainty (EPU) with a focus how EPU affects allocative efficiency. observe that the market value of firms in about 37% Fama–French 30 industries, but leads to lower investments 90% them. Allocation decisions economy rely signals from capital market, which distorts. This may cause increasing conflicts interest between managers and investors. ...

a r t i c l e i n f o a b s t r a c t JEL classification: C70 D44 D61 Keywords: Online auctions Posted price selling Buy-it-now Allocative inefficiency Random matching eBay auctions In an auction-style listing at eBay, sellers have the option to set a posted price (also known as buy-it-now price), which allows buyers to instantly purchase an item before the start of the auction. This paper prov...

The technical and allocative efficiency of broadacre farmers in a southern region of Western Australia is investigated over a three-year period. Applying data envelopment analysis (DEA) and stochastic frontier analysis (SFA) reveals there is some inefficiency in each year, which decreases over time. The distributions of technical efficiency in each year are positively skewed toward higher effic...

This is a case study of asset specific investments, a class of transactions that is well understood in the context of economic theory but that is under-analyzed empirically. Because specific investments are particular to a single location, use or customer, their next best use is of much lower value than the use for which they are initially intended. Consequently, asset specific investments face...