Understand what allocative efficiency is and when it occurs. Learn the definition and formula for allocative efficiency, and see examples of allocative efficiency. Related to this Questiona. Why do markets sometimes fail to allocate resources efficiently? b. How can government policies potentially impro...
(2013) The directional profit efficiency measure: on why profit inefficiency is either technical or allocative. Journal of Productivity Analysis 40(3): 257-266.Zofio J L, Pastor J T, Aparicio J. The directional profit efficiency measure: On why profit inefficiency is either technical or ...
In a perfectly competitive labor market, why does the imposition of a minimum wage above the equilibrium wage level lead to allocative inefficiency? Why do upward-sloping labor supply curves to firms cause the marginal expense of labor to exceed the wage rate? Union members are generally paid...