Integrating Consumer Satisfaction into Productivity Indexes
The purpose of this chapter is to generalize the Malmquist index of productivity to reflect information on consumer satisfaction. We accomplish this by adopting the utility indirect input distance function (proposed by Shephard in 1974) as the building block for the productivity index. This distance function seeks to minimize input use subject to both utility and production constraints. Like other Malmquist productivity indexes, this may be decomposed into technical change and efficiency change. The advantages of this preference indirect Malmquist index is that an additional quality change component may be identified, and that demand side influences can be included even without market prices.
KeywordsDistance Function Data Envelopment Analysis Technical Change Data Envelopment Analysis Model Productivity Index
Unable to display preview. Download preview PDF.
- Dertouzos, M., R. Lester and R.M. Solow Made in America, Cambridge, Mass., MIT Press (1989).Google Scholar
- Fixler, D. and K. Zieschang. “Incorporating Ancillary Measures of Process and Quality Changes into a Superlative Productivity Index,” Journal of Productivity Analysis (1992), 245–267.Google Scholar
- Karlin, S. Mathematical Methods and Theory of Games, Programming, and Economics, Vol. I, Addison-Wesley (1959).Google Scholar
- Shephard, R.W. Indirect Production Functions, Verlag Anton Hain, Meisenheim am Glan, (1974).Google Scholar