| Article ID: | iaor19981244 |
| Country: | Netherlands |
| Volume: | 80 |
| Issue: | 3 |
| Start Page Number: | 654 |
| End Page Number: | 671 |
| Publication Date: | Feb 1995 |
| Journal: | European Journal of Operational Research |
| Authors: | Ray Subhash C., Kim Hiung Joon |
| Keywords: | statistics: data envelopment analysis, manufacturing industries |
In this paper we use nonparametric methods to get upper and lower bounds on the levels of technical and overall cost efficiency in the US steel industry during the period 1958–86. Possibilities of both non-regressive technical change and ‘no technical change’ have been considered. The empirical analysis shows that the competitive status of US steel producers can be greatly enhanced even within the existing technologies if identified technical and allocative inefficiencies can be eliminated. The evidence does not suggest that cost inefficiency in the domestic steel industry is mainly due to diversion of resources in order to comply with various pollution control regulations.