Technical Inefficiency Research Articles

Stochastic Frontier Analysis of Technical Efficiency of Smallholder Maize Farmers in Morogoro Municipality: A Reflection from RIPAT Program

This study looks into the elements that influence maize production and technical efficiency among households participating in the RIPAT SUA Project in Morogoro Municipality, using stochastic frontier analysis for the 2022 – 2023 season. The focus was on socio-economic characteristics, land size, seed usage, use of fertilizer extension services, training from the project, and education. The primary objective was to examine the factors influencing maize production and efficiency by evaluating socioeconomic aspects and specific agricultural techniques. A total of 110 households were surveyed with standardized questionnaires. Socioeconomic data was collected, key variables were evaluated and key variables were analyzed using descriptive statistics and stochastic frontier analysis. The results reveal that land size harms productivity (β = -0.436, p < 0.001), whereas improved seed usage has a positive impact (β = 0.401, p = 0.016). Education level (β = -1.168, p = 0.002) and agriculture experience (β = -0.016, p = 0.049) considerably reduce technical inefficiency, insisting on the importance of education interventions. Additionally, 40% of households have access to VSLA, revealing financial problems. While 94.55% of households got training, only 18.18% received extension services which could hamper the best productivity. Every household reported owning land and using seeds highlighting that they had the necessary materials for maize production. Regarding technical efficiency, Magadu ward high score of 5%, while Kauzeni has the lowest at 1.9% suggesting significant disproportions in productivity among wards. These findings emphasize the importance of focused initiatives to improve agriculture productivity through enhancing farmer education and training, experience, and increased access to finance. These strategies are critical for improving maize productivity and addressing food security issues among households participating in programs like the RIPAT SUA initiative hence will increase agricultural efficiency and contribute to more farmer-sustainable farming methods throughout the region

Metformin in the Diabetes Prevention Program 3-year trial: The cost-effectiveness that never was.

To highlight oversimplified quality-adjusted life year (QALY) calculations and incremental cost-effectiveness ratios (ICERs) regarding lifestyle metformin and placebo as flaws in the trial-based (Diabetes Prevention Program) cost-effectiveness analysis. We revised the QALY calculations to conform to convention and calculated appropriate ICERs using both original and revised QALYs results. We used several additional health economics tools to present results, showing the consistency of each method and the added value of each. We presented net monetary benefits, assessed decision uncertainty and calculated net losses. We also used graphics, making correct interpretation clearer and allowing illustration and calculation of technical and economic inefficiencies of treatments that were not cost-effective. ICERs with either QALY calculation indicated that metformin was technically and economically inefficient and not cost-effective. There was virtually no decision uncertainty. All methods employed pointed to an identical conclusion. In contrast to original claims, although lifestyle was cost-effective in diabetes prevention, metformin was not, and acting otherwise imposes significant monetary and health costs. Various available tools of economic evaluation would probably have prevented the original misinterpretation by the authors had they been used. The varied tools implemented here illustrate with a common example their consistency and value to the field, showing how to depict the results in various ways.

Resource productivity and determinants of technical efficiency among cassava farmers’ in north central, Nigeria

This research analyzed resource productivity and determinants of technical efficiency among cassava farmers in North Central, Nigeria. This research employed a multi-stage sampling technique. Primary data were used based on a well-designed questionnaire. Inferential and descriptive statistics were employed for data analysis. The results of resource productivity of inputs show that cassava cuttings and fertilizer have the highest and lowest elasticities, respectively. The mean-TE (Technical Efficiency) score of 74% (0.74) indicates that an average smallholder cassava producer in the sample needs about 26% (0.26) additional inputs to get to the frontier. In the TE components, the coefficients of labour, and fertilizers are significant different from zero at 1% probability level. The coefficients of agrochemicals, land inputs are significantly different from zero at 5% probability level, while the coefficient of cassava cuttings are significant different from zero at 10% probability level. In the TIE (technical inefficiency), component the coefficients of age, credit received, members of cooperatives are significant different from zero at 1% probability level. The policy formulations should be directed towards considering technological substitutions and mechanized agriculture. Excessive labour supply, characteristics of the developing agriculture in sub-Saharan Africa, could be pushed into the secondary sector of the Nigerian economy such as the cassava processing industry, therefore generating income, employment and maintaining Nigeria in the first (1st) position in the world ranking in term of cassava output. Also, it is recommended that improved cuttings, agrochemicals, and fertilizers should be made available to cassava farmers at appropriate time to increase productivity. Furthermore, credit should be made available to cassava farmers at a single digit interest rate, devoid of cumbersome administrative procedures. Keywords: Resource productivity, technical efficiency, cassava farmers, stochastic frontier model, Nigeria

Assessing Technical Inefficiency in Ecosystem Service Provision from an Input Perspective in the Cross Timbers region, United States.

We modeled the efficiency of ecosystem service provision-specifically timber production, carbon sequestration, and water yield-in the Cross Timbers region of the United States using stochastic frontier analysis from an input perspective. Inputs considered included natural capital and control variables such as temperature, precipitation, soil moisture, and natural disturbances, among others, that impact ecosystem service production. Inefficiency was modeled as a function of factors such as ownership, forest productivity, and natural disturbances. We utilized forest plot-level data obtained from the Forest Inventory and Analysis (FIA) program between 2008 and 2019. Our results indicated that ecosystem service production increased with higher levels of natural capital, higher temperatures, mesic soils, the presence of oaks, and damage caused by abiotic factors. We found evidence of technical inefficiency in the simultaneous provision of ecosystem services. From an input perspective, our findings revealed that, on average, 15.9% more input is used due to technical inefficiency in the Cross Timbers region. Specifically, private ownership and damage caused by abiotic factors resulted in excess input use of 16.4% and 14.3%, respectively, due to technical inefficiency. Managing the encroachment of invasive species like eastern redcedar can enhance ecosystem service production in the region, despite the high implementation costs. Collaboration among multidisciplinary extension professionals can help create comprehensive land management plans for the Cross Timbers, while landowners can also utilize cost-share programs to lower management expenses.

Agricultural trade liberalization, governance quality, and technical efficiency in the agricultural sector of Southeast Asia

International trade has been regarded as an essential factor in enhancing a country's productivity and efficiency. Nevertheless, developing countries squander money and resources as a result of their deficient institutional quality, impeding their ability to profit from specialization and trade. Therefore, this study intends to investigate the impact of agricultural trade liberalization and governance quality on technical efficiency in Southeast Asia's agricultural sector using balanced panel data spanning from 2002 to 2021. The research utilizes translog stochastic frontier analysis (SFA) with a single-stage maximum likelihood estimation (MLE) to simultaneously calculate the time-varying technical efficiency scores and explore the core factors influencing agricultural inefficiency. The findings reveal that the average output-oriented technical efficiency for ASEAN-8 countries was 94 %. This suggests that there is significant potential to enhance technical efficiency in agricultural production by up to 6 % by addressing the adverse impacts of technical inefficiency. The research findings further point out that Malaysia is the most technically efficient country, having a technical efficiency score of 99.82 %, followed by Vietnam (99.75 %), Thailand (99.70 %), Lao PDR (98.90 %), Myanmar (95.42 %), Indonesia (91.64 %), the Philippines (90.65 %), and Cambodia (76.11 %). The results of disaggregated agricultural trade liberalization demonstrate a significant reduction in agricultural inefficiency in Southeast Asia through agricultural exports and imports. The findings also emphasize that improvements in the rule of law positively contribute to agricultural efficiency, whereas enhancements in terms of voice and accountability and regulatory quality appear to reduce it. Based on these findings, the government should consider enlarging open and liberalized trade policies in order to facilitate the exchange of technology and knowledge within the agriculture sector. Additionally, the government should involve farmers, agricultural cooperatives, local communities, and other relevant stakeholders in the decision-making process to ensure that policies address the specific needs and constraints faced by the sector.

The adoption of cotton combine services and farm technical efficiency: evidence from Kazakhstan and Uzbekistan

PurposeThis study examines the adoption of cotton combine services and its impact on farm technical efficiency in Kazakhstan and Uzbekistan. The research aims to determine whether mechanisation influences productivity and economic output at the farm level.Design/methodology/approachUsing farm-level data from 511 cotton growers in Kazakhstan and Uzbekistan collected in 2019, this study employs stochastic frontier analysis to measure potential output and technical inefficiency among cotton farmers. The analysis includes a translog functional form to account for the use of cotton combine services and other farming variables.FindingsThe findings indicate that while mechanisation through cotton combines can potentially increase technical efficiency by optimising the harvesting process, the benefits are not uniformly experienced across all farms. Variations in farm characteristics, such as labour availability and existing agricultural practices, influence the efficiency of technology adoption. Institutional factors and historical legacies also play a significant role in the adoption and impact of mechanisation.Research limitations/implicationsThe study is based on cross-sectional data from 2019, and the findings may not capture longer-term trends or recent developments in mechanisation policies in the study countries.Originality/valueThis research provides a nuanced understanding of the conditions under which cotton combine services enhance or hinder technical efficiency. It highlights the necessity for carefully tailored policies for mechanisation, especially in Uzbekistan, where rural labour is abundant and predominantly female. The study contributes to the broader discourse on agricultural mechanisation in developing countries by focusing on the specific context of Central Asia.

Persistent and transient inefficiencies in the U.S. airline industry

The competitive advantage of airlines depends on their technical efficiency. Efficiency analysis models now differentiate between persistent and transient inefficiencies. Persistent inefficiencies stem from fundamental flaws in production processes or ongoing managerial shortcomings, requiring long-term strategic interventions. Transient inefficiencies, however, result from irregular setbacks that can be swiftly addressed, causing temporary efficiency dips. Focusing on the decade from 2010 to 2019, we investigated how business models, mergers, and upgauging influence these inefficiencies. Our results reveal that 21.2% of the overall technical inefficiency can be accounted for by persistent inefficiency. Despite the U.S. airline industry improving transient inefficiency during the sample period, prevailing persistent inefficiency hindered any significant rise in overall efficiency. The research shows that full-service airlines (FSA) and low-cost carriers (LCC) often exhibit higher persistent and transient efficiency than ultra-low-cost carriers (ULCC). However, there seem to be no significant differences in transient and persistent inefficiency between FSA and LCC. Additionally, the results suggest that the upgauging and higher ramp-to-ramp hours may lead to higher transient efficiency. Finally, we could not find any influence of mergers and stage length on transient inefficiency.

Production of biodiesel from non-edible industrial oilseeds via non-catalytic transesterification

The non-catalytic conversion of non-edible biomass into biodiesel (BD) is the subject of this investigation. Conventional oil extraction from biomass often results in economic and technical inefficiencies. This study suggests a non-catalytic transesterification reaction to directly convert castor seeds into BD in order to overcome these problems. Base-catalysed transesterification of extracted castor seed oil had a BD yield of 84.43 wt% (reaction time: 24 h at 60 ˚C). In contrast, non-catalytic transesterification of castor seed oil produced a BD yield of 93.79 wt%, which completed the reaction in 1 min at 390 ˚C. Thus, using the non-catalytic transesterification approach, we were able to empirically verify the greater conversion efficiency of BD. Additionally, the direct non-catalytic conversion of castor seed to BD achieved a yield of 105.81 wt%, suggesting that substantial oil loss occurs during the extraction process. These findings suggest that the traditional method of converting BD, which involves oil extraction and base-catalysed transesterification, is less efficient and less financially advantageous than directly converting castor seeds into BD.

Analysis of green productivity in manufacturing based on different air pollution levels

China’s manufacturing industry needs to change from a high-emission model to one that is more environmentally friendly to reduce air pollution and achieve sustainable growth. Therefore, it is important to decrease manufacturing waste gas emissions by improving green productivity. This paper expands on the theories of green economic growth and sustainable development to present a framework for analysis of manufacturing green productivity at various levels of air pollution. It applies the Metafrontier Malmquist Luenberger index and SBM model to data from 30 Chinese manufacturing sectors from 2012 to 2022 to identify the obstacles to developing green productivity in the manufacturing sectors. The results show that: (1) From 2012 to 2022, the overall waste gas emission efficiency and GTFP of China’s manufacturing industry showed an increasing trend. (2) The manufacturing industry with light air pollution had the fastest growth in GTFP, followed by manufacturing with heavy air pollution, and manufacturing with moderate air pollution had the lowest. (3) The primary driver of GTFP growth is technological progress, while technical inefficiency has severely hindered GTFP growth. (4) There is a “Matthew effect” in the green productivity of China’s manufacturing industry. High waste gas emission efficiency often accompanies high levels of GTFP, and vice versa. Finally, this paper proposes policy suggestions to improve the green productivity of the manufacturing industry and reduce air pollution.

Heterogeneous strategy and performance decomposition of regional industries in China: From the perspective of resource misallocation

AbstractThe rapid expansion of China's industrial sector has been accompanied by energy consumption and environmental pollution. Accurately identifying the sources of inefficiency of industrial sector is crucial for achieving sustainable development. To address this issue, this study develops a novel decomposition approach that combines the concepts of natural and managerial disposability with an aggregate directional distance function approach to measure the performance of regional industries in China from 2006 to 2019. In the proposed approach, the overall inefficiency is decomposed into technical inefficiency and structural inefficiency. The latter component, which captures inefficiency associated with resource misallocation within a country, is further divided into mix and scale elements. The results show that there remains much room for potential improvement in both the operational and environmental performance of China's industrial system, particularly in the central area. Furthermore, structural inefficiency is the primary contributor to the overall inefficiency of Chinese industry under natural disposability, whereas technical inefficiency appears as the main source of the inefficiency under managerial disposability. The results also reveal great disparities in terms of the overall inefficiency and the sources of inefficiency of Chinese industrial sector among regions between different mitigation strategies. Given the substantial structural effect on the performance of Chinese industries across regions, it is necessary to accelerate the establishment of market mechanisms to promote efficient allocation of resources.

Indonesian SDGS Problems: Technical Inefficiency Due to Economic Crime and Income Inequality

Objective: The study objective is investigating the technical inefficiency resulted from economic crime and its association with income inequality, with the study aims are modeling a stochastic frontier aggregate production function, measuring inefficiency, and mapping the economic inefficiency due to economic crime with income inequality association. Theoretical Framework: The main concepts are Crime Economics, Stochastic Frontier Analysis, and Aggregate Production Function. Method: The methodology comprises a stochastic frontier aggregate production function modelling to calculate technical inefficiency due to economic crime and mapping technical inefficiency due to economic crime with income inequality association. The data is Indonesian provincial data from 2016 to 2019 provided by Indonesian Statistics. Results and Discussion: The modelling reveals that aggregate production stochastic frontier is established and technical inefficiency due to economic crime is calculated. The mapping shows that some provinces experience positive association between technical inefficiency due to economic crime with income inequality. Research Implications: This study implies the importance of concerning theoritically and practically to technical inefficiency due to economic crime and its association with income inequality. These implication can encompass economic, social, and security sectors. Originality/Value: This study contributes to the literature by modeling the stochastic frontier aggregate production function that accommodates economic crime, measuring technical inefficiency due to economic crime, and mapping the technical inefficiency due to the economic crime with income inequality association. The relevance and value of this research are evidenced by SDGs components such as decent work and economic growth, reduced inequalities, and peace, justice, and strong institutions.

The Impact of Subsidies on Persistent and Transient Technical Inefficiency: Evidence from Polish Dairy Farms – ERRATUM

The Impact of Subsidies on Persistent and Transient Technical Inefficiency: Evidence from Polish Dairy Farms – ERRATUM

Effect of Seed and Fertilizer Subsidies on the Technical Efficiency of Rice Farmers in Senegal

The aim of this study was to analyze the effect of seed and fertilizer subsidies (NPK and urea) on the technical efficiency of rice farmers in Senegal. Using data from the Annual Agricultural Survey (EAA) of the Directorate of Analysis, Forecasting and Agricultural Statistics of Senegal (DAPSA), the results of Stochastic Frontier Analysis (SFA) revealed that rice farmers in Senegal have on average a technical efficiency level of 0.545. This suggests that they could increase their current production by 45.5% while using the same level of inputs. Estimation of an SFA model for technical inefficiency revealed that seed and urea subsidies have a significant effect on reducing technical inefficiency. A farmer using subsidized seed saw a reduction in technical inefficiency level by 10.5% and using urea was associated with a 5.1% decrease in inefficiency. In contrast, the model showed no association between the use of subsidized NPK or the use of herbicides and technical inefficiency. And use of organic fertilizer was estimated to worsen technical inefficiency by 4.4% (perhaps reflecting greater reliance on lower-cost inputs among less productive farm households in Senegal). With regard to socio-demographic factors, the results further revealed older respondents experienced more severe technical inefficiency, and that women on average were 9.6% more inefficient than men. These barriers to improved efficiency among older farmers and women suggest targeted supports may be necessary alongside general subsidy programming.

Analysis of Technical Efficiency of Fertilizer Subsidy Program in Coffee Farming, A Case study of Kenya

Fertilizer subsidy program is used to boost productivity by availing fertilizer to farmers at a cheaper price than the market price. This research sought to determine the technical efficiency of fertilizer subsidy program on coffee farming in Kenya. Coffee is a major cash crop of small-scale farmers, which has been experiencing declining productivity. The study adopted non-experimental cross-section research design. The study was carried out in Mukurwe-ini Sub-County, in Nyeri country, Kenya. Structured questionnaire were used to collect primary data from coffee farmers. Stochastic frontier production function (SFA) was used to evaluate the technical efficiency of coffee farming by analysing the relationship between coffee inputs and outputs. The SFA results revealed that fertilizer subsidy has a significant effect on technical efficiency. The technical efficiency for the individual farmers was found to range between 10.44% and 95.15% with a mean of 77.87%. The results revealed that about 76% of the coffee farmers were operating above 70 percent or more technical efficiency levels. Additionally, about 94% of the coffee farmers were operating at a technical efficiency level of above 50%. The coffee cooperative societies had variance in their technical efficiency - Rumukia at 80.65%, Ruthaka at 76.12%, Rugi at 79.97% and Gikaru at 79.24%. Technical inefficiency was found to be significantly influenced by age of the farmers and cooperative societies’ management. The study recommends development of inclusive policies that address income disparities among coffee farmers, improvement of cooperative societies’ management, and enhancing farmers’ trainings

Technical Efficiency of Indonesian Potato Farming during Rainy and Dry Seasons: Evidence from Merangin District, Indonesia

Potatoes are among the vegetables highly susceptible to climate change, and its consequences can significantly affect technical efficiency.However, the production of potato relatively fluctuated due to some factors influencing it. The study aims to analyze the factors affecting potato production, measure the level of technical efficiency in potato farming, and identify the socio-economic factors that influence technical inefficiency in potato farming, both in the rainy and dry seasons. The study was conducted in Merangin Regency, Jambi Province. A purposive sampling method was used to select the research area and collect data from 102 potato farmers. The data were analyzed using the Stochastic Frontier Cobb-Douglas production function model with a maximum likelihood estimation (MLE) approach. The research results show that land and seed variables significantly influence potato production, both in the rainy and dry seasons. Meanwhile, fertilizer P and labor only significantly influence the dry season. The average level of technical efficiency in the dry season (0.89) is higher than in the rainy season (0.73). The results of the average difference test (t-test) show that in the dry season, the level of technical efficiency has a higher value than in the rainy season, with a significance of 1%. The significant socio-economic variables influencing technical efficiency are membership in farmer groups.

Elementary education outcome efficiency of Indian state governments: a generalized stochastic frontier approach

PurposeThis paper aims to analyze the technical efficiency of Indian State governments in providing elementary education (EE) and to identify the determinants of their technical inefficiency.Design/methodology/approachThe Generalized Stochastic Frontier Approach (GSFA) is used in the context of the Inefficiency Effects Model to simultaneously estimate the frontier production function and the technical inefficiency model. Panel data of 28 Indian States from 2009–10 to 2018–19 is used.FindingsThe mean efficiency of States stands at 86%. Efficiency varied between 67 and 97%. 96% of the inter-state disparity in EE outcomes can be explained by inefficiency. Arunachal Pradesh is the least efficient State, followed by Sikkim and Tripura. Efficiency estimates were observed to change across States over the study period. Proportion of government schools, rural population, and proportion of Schedule Caste and Schedule Tribe children are the major determinants of inefficiency.Practical implicationsThis study emphasizes that efficient resource management is as important as adequate resource allocation for achieving positive EE outcomes. It distinguishes resource-poor States from inefficient ones, providing insights to enhance States’ efficiency, and aiding policymakers in formulating strategies for ensuring equitable and quality EE.Originality/valueThis is the first paper to apply GSFA (for Indian States), providing a more robust estimation of efficiency. The Inefficiency Effects Model is employed that address the limitations inherent in the two-stage approach.

TECHNICAL EFFICIENCY OF LAYER FARMERS IN AKWA IBOM

This study analyzed the technical efficiency of layer farmers in Akwa Ibom State, Nigeria. A multistage random sampling technique was employed to select a total of 100-layer farmers across three agricultural zones in Akwa Ibom State. Relevant data was collected with the aid of a questionnaire. Data collated from the field was analyzed using descriptive statistics, stochastic production frontier, and maximum likelihood estimates. The result showed that most of the farmers were female, with mean age of 36.68 years for layer farmers. The production function estimate showed that hired labour, feeds, capital depreciation, pen size, and saw dust use positively influenced output of layer birds, while family labour and medication had a negative impact on output. The technical efficiency distribution showed a mean efficiency of 66%. The determinants of technical inefficiency showed that education, family size, market share, farming experience, extension visits, trainings, farm size and membership in social groups had negative influence of technical inefficiency of layer production, and farmers age and access to credit had a positive effect on the technical inefficiency of layer production. The study recommends the government and relevant stakeholders should make efforts to subsidize the cost of essential poultry inputs, and develop a workable system to enable poultry farmers access credit. Also, extension training should be intensified as it is shown to improve the technical efficiency of layer farmers.

ANALYSIS OF TECHNICAL EFFICIENCY OF CASSAVA FARMERS IN ABAK LOCAL GOVERNMENT AREA OF AKWA IBOM STATE, NIGERIA

The study analyzed the technical efficiency of cassava farmers in Abak Local Government Area of Akwa Ibom State, Nigeria. The specific objectives were to; describe the socio-economic characteristics of cassava farmers; determine the technical efficiency of cassava farmers; estimate the determinants of technical efficiency among cassava farmers and examined the constraints militating against cassava production in the study area. Multistage sampling procedure was used in selecting 120 respondents for the study. Primary data were obtained using structured questionnaire and the data obtained were analyzed using descriptive statistics and stochastic frontier production function. The result showed that the average age, household size, farming experience, and farm size of the sampled respondents were 39 years, 4 persons, 6 years and 1.9 hectares, respectively. The mean, maximum and minimum technical efficiency were 0.73, 0.95 and 0.38. The findings on the estimated stochastic production function and the determinants of technical inefficiency showed that farm size (p<0.01), cuttings (p<0.01) and labour (p<0.01) were found to be significant inputs in cassava production while household size (p<0.1), education (p<0.01), monthly income (p<0.01), membership of cooperative (p<0.01), access to credit (p<0.01) and access to extension services (p<0.1) were the determinants of technical inefficiency of cassava production in the study area. Also, the major constraints to cassava production were, high cost of fertilizer (13.7%), theft (13.7%), lack of access to credit (13.7%), inadequate access to land (13.7%), and poor road network (13.7%). The study recommends that training and capacity-building programs should be targeted to improve farmers' knowledge and skills in efficient cassava production techniques, with a focus on optimizing inputs such as farm size, cuttings, labour and extension services. Also outreach programs should be strengthened to provide farmers with timely information, technical support, and best practices for cassava production, thereby reducing technical inefficiencies.

Productivity and technical inefficiency: A case study of small dryland mungbean farming in East Nusa Tenggara, Indonesia

Mungbeans are one of the important agricultural products for food security in East Nusa Tenggara (NTT) Province, which is one of the driest regions in Indonesia. The low productivity and profitability of mungbean farming in this region are caused by factors that influence agricultural inefficiency. This study was conducted to measure the productivity and technical efficiency levels, as well as investigate the factors affecting farm inefficiency, using the Technical Efficiency Effect Model (TEEM) applied to the frontier logarithmic transcendental production function. The method applied in this research is descriptive qualitative based on survey and interview results through primary and secondary data. Firstly, the results showed that mungbean farming was in the increasing return to scale stage of production and productivity only reached 57% of its production potential, with a technical efficiency level of 66%. Secondly, the factors that positively influence the low productivity and technical efficiency level of mungbean farming are land, seeds, labor, and the interaction between land and labor. Meanwhile, farmer experience and farm training significantly reduce the inefficiency of mungbean farming. It is suggested that increasing land productivity with appropriate and intensive modern technology and improving labor skills are the main strategies for reducing inefficiencies and increasing the income of smallholder farmers in drylands.

Numeraire choice, shadow profit, and inefficiency measurement

We study a programming approach to inducing inefficiency measures for convex technologies. It takes the technology and the numeraire as given and uses variational arguments to isolate shadow prices that make a decision maker’s observed behavior as efficient as possible. The focus is on how the numeraire determines the element of the efficient frontier to which a decision maker’s performance is compared, the resulting technical inefficiency measure, and whether that measure offers a cardinal representation of the technology. We use the results to study an inefficiency measure, the polyhedral measure, that generalizes an array of existing measures.