In this paper, we provide a characterization of interim inefficiency in stochastic economies of overlapping generations under possibly sequentially incomplete markets. With respect to the established body of results in the literature, we remove the hypothesis of two-period horizons, by considering longer, though uniformly bounded, horizons for generations. The characterization exploits a suitab...

It is known that the incompleteness of asset markets causes inefficiency in almost every equilibrium. Yet unexplored is the ”size” of this inefficiency. The size of a Pareto improvement is the total willingness to pay for it, out of current consumption. Inefficiency is the maximum size of any Pareto improving reallocation. Inefficiency of US consumption in middle age is computed to be 10-11% of...

PURPOSES To assess the relationship between hospitals' X-inefficiency levels and overall care quality based on the National Quality Forum's 27 safe practices score and to improve the analytic strategy for assessing X-inefficiency. METHODOLOGY The 2005 versions of the American Hospital Association and Leapfrog Group's annual surveys were the basis of the study. Additional case mix indices and ...

Previous research has argued that debt financing affects equityholders’ investment decisions, producing substantial inefficiency. This paper shows that the size of this inefficiency depends on the degree of investment reversibility. In a dynamic model of financing and investment, the paper provides an upper bound for the inefficiency produced by debt financing. The upper bound is decreasing in ...

X.efficiency theory challenges the maximization postulate of standard economic theory. This paper shows that X-inefficiency is. at times, as much as 30 times greater than allocative inefficiency and suggests reasons for the existence of X-inefficiency—-i.e., (a) incomplete employment contracts, (b) discretionary effort, and (c) nonmaximization of profits. [The Social Sciences Citation Index® (S...

This paper studies entry in local real estate brokerage to investigate sources of potential cost inefficiency under free entry. Building upon recent empirical work on games of incomplete information, we construct a structural entry model and estimate the model using nested pseudo likelihood algorithms. Using data from 5% PUMS in 2000, we find direct evidence for two sources of cost inefficiency...

This paper provides a concise review of a broad set of concepts, models and estimation issues in the field of stochastic frontier analysis. The goal is to provide practitioners with a quick guide to some key ideas. The review is restricted to single-output models estimated by econometric methods. Among the conceptual issues are the interpretation and the paths to reduce inefficiency. The modell...

relative to a hereditary torsion theory $tau$ we introduce a dimension for a module $m$, called {em $tau$-rank of} $m$, which coincides with the reduced rank of $m$ whenever $tau$ is the goldie torsion theory. it is shown that the $tau$-rank of $m$ is measured by the length of certain decompositions of the $tau$-injective hull of $m$. moreover, some relations between the $tau$-rank of $m$ and c...