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Journal Articles Applied Economics Year : 2017

Hypercongestion in production correspondences: an empirical exploration

Abstract

This empirical contribution reviews the rather limited existing literature measuring congestion in production. It first compares current ways to measure congestion using nonparametric specifications of technologies. In particular, it focuses on the magnitude and incidence of the congestion detected in empirical studies using traditional radial efficiency measures. Thereafter, it shows the limitations of this radial measurement and how alternative measurement schemes may reveal higher amounts of congestion. Then, the new, more general methodology of measuring S-congestion is presented. In particular, we first present a numerical example to illustrate the way the S-disposable technologies allow to capture more extreme forms of congestion by setting empirically determined upper bounds to the wasting of inputs. Then, an empirical illustration is presented based on an existing sample of data. A final section concludes.

Dates and versions

hal-01744571 , version 1 (27-03-2018)

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Walter Briec, Kristiaan Kerstens, Ignace van de Woestyne. Hypercongestion in production correspondences: an empirical exploration. Applied Economics, 2017, 50 (27), pp.2938 - 2956. ⟨10.1080/00036846.2017.1412080⟩. ⟨hal-01744571⟩
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