Abstract
In this paper it is shown that a well known procedure (GEKS) of transitivizing a bilateral system of productivity comparisons is implicitly a way of imposing a homothetic structure onto the data. The main implication of this result is that deviations between the bilateral and the multilateral (GEKS) indexes can be interpreted as a measure of local deviation from the homothetic assumption. This establishes an additional link between homotheticity and transitivity.
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I would like to thank Finn Forsund and three anonymous referees for providing constructing comments and suggestions. The usual disclaimers apply.
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Peyrache, A. Multilateral productivity comparisons and homotheticity. J Prod Anal 40, 57–65 (2013). https://doi.org/10.1007/s11123-012-0298-7
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DOI: https://doi.org/10.1007/s11123-012-0298-7