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This book presents a mathematical programming approach to the analysis of production frontiers and efficiency measurement. The authors construct a variety of production frontiers, and by measuring distances to them are able to develop a model of efficient producer behaviour and a taxonomy of possible types of departure from efficiency in various environments. Linear programming is used as an analytical and computational technique in order to accomplish this. The approach developed is then applied to modelling producer behaviour. By focusing on the empirical relevance of production frontiers and distances to them, and applying linear programming techniques to artificial data to illustrate the type of information they can generate, this book provides a unique study in applied production analysis. It will be of interest to scholars and students of economics and operations research, and analysts in business and government.

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We explore the relationship between Shephard's input distance function and Luenberger's benefit function. We point out that the latter can be recognized in a production context as a directional input distance function which can exhaustively characterize production technologies under appropriate assumptions on input disposability. McFadden's composition rules for input sets and input distance functions are then extended to the directional input distance function. Working Paper 95-09 Scientific Article No. , Contribution No. from the Maryland Agricultural Experiment Station.

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