allocative efficiency


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allocative efficiency

A measure of economic efficiency which weighs the benefit derived from a particular choice in the distribution of resources. Allocative efficiency perspective addresses the question of whether to perform or expand an activity.

allocative efficiency

(al′ŏ-kāt″ĭv)
In economics and sociology, the extent to which a product or a service, e.g., hemodialysis, is provided to an entire community, rather than just to a subgroup of that community.
References in periodicals archive ?
(32) Because the Sherman Act is an anti-trust measure, and some legislators believed large trusts were generally more efficient than small and medium-sized businesses, Professor Lande concludes that allocative efficiency could not have been the sole value underlying the statute.
The average allocative efficiency of the banks in the sample is 86.12 percent, indicating that the banks on average could have saved 13.88 percent in costs if they have used the most appropriate input-mix (optimal input-mix).
Allocative efficiency, measured in terms of the number of learning opportunities (inputs) needed to produce 100 contingency behavior (outputs), makes clear the differences in the effects of response-independent and response-contingent stimulation.
The lower the fixed and transport costs, and the higher the market density, the better the allocative efficiency and the lower the price.
Indeed, allocative efficiency has little to say about economic and social topics such as social cohesion, redistribution, regional planning etc.
Waste, which arises from both structural and non-maximizing behavior, thus has implications for both allocative efficiency (effective adaptation) and non-allocative efficiency (elimination of waste).
But, their expanded fiscal and regulatory roles can affect allocative efficiency and, through certain carve-outs and rules regarding preferential credit, they are pressed into the job of distributional justice (mortgage preferences, small-business lending, and so on).
The allocative efficiency (AE) is the ratio of cost efficiency to technical efficiency and expressed as
Notwithstanding the allocative efficiency of capital markets, the implications for firms that are valued for growth is that managers of these firms must recognize the opportunity of digital innovation and create capabilities to exploit this opportunity.
Globally, allocative efficiency is the main hope of electorates in a democratic system of government.
The performance of a contest can therefore be measured along different dimensions, including effort elicitation, prize allocative efficiency, players' payoffs, and so on.
In light of these factors, it is critical that the political leadership realise that increased inflow of foreign capital will enhance the allocative efficiency of the capital, and will give an upward thrust to domestic stock-market prices.