This book provides a detailed introduction to the theoretical and methodological foundations of production efficiency analysis using benchmarking. Two of the more popular methods of efficiency evaluation are Stochastic Frontier Analysis (SFA) and Data Envelopment Analysis (DEA), both of which are based on the concept of a production possibility set and its frontier. Depending on the assumed objectives of the decision-making unit, a Production, Cost, or Profit Frontier is constructed from observed data on input and output quantities and prices. While SFA uses different maximum likelihood estimation techniques to estimate a parametric frontier, DEA relies on mathematical programming to create a nonparametric frontier. Yet another alternative is the Convex Nonparametric Frontier, which is based on the assumed convexity of the production possibility set and creates a piecewise linear frontier consisting of a number of tangent hyper planes.

Introduction - Ray, Subhash; Kumbhakar, Subal & Dua, Pami.- Chapter 1. Estimation of Technical Inefficiency in Production Frontier Models Using Cross-Sectional Data by Kumbhakar, Subal C. & Wang, Hung-Jen.- Chapter 2. Data Envelopment Analysis for Performance Evaluation: A Child's Guide by Ray, Subhash C. & Chen, Lei.- Chapter 3. An Introduction to CNLS and StoNED Methods for Efficiency Analysis: Economic Insights and Computational Aspects by Johnson, Andrew L. and Kuosmanen, Timo.- Chapter 4. Dynamic Efficiency Measurement by Førsund, Finn R.- Chapter 5. Efficiency Measures for Industrial Organization by Ten Raa, Thijs.- Chapter 6. Multiplicative and Additive Distance Functions: Efficiency Measures and Duality by Pastor, Jesus T. & Aparicio, Juan.