Introduction

Abstract

During the June 2015 European Workshop on Efficiency and Productivity Analysis in Helsinki, we sat together and tried to map a broad view of performance analysis. The prevailing approach is frontier analysis. The production frontier of a “decision making unit” (such as a firm, an industry, an economy, or conglomerates of the aforementioned) maps the maximum amount of output given the available input, where input and output are multidimensional objects, comprising different types of labor, capital, intermediate inputs, goods, services, and other products. If the “distance” between the actual input-output combination of a decision making unit and the frontier is small, then the unit is efficient. If the frontier is far out, then efficient units are productive. This framework is amenable to precise measurements of efficiency and productivity, but numerous issues surround it and cast shadows on numerical results. This compendium collects a set of works that explore these issues.