efficiency

Examples of efficiency in the following topics:

• Productive Efficiency

  • Productive efficiency occurs when the economy is getting maximum output from its resources .
  • An equilibrium may be productively efficient without being allocatively efficient.
  • Productive efficiency requires that all firms operate using best-practice technological and managerial processes.
  • So, consumers may pay less with a monopoly, but a monopolistic market would not achieve productive efficiency.
  • Points B, C, and D are productively efficient and point A is not.

• Allocative Efficiency

  • Free markets iterate towards higher levels of allocative efficiency, aligning the marginal cost of production with the marginal benefit for consumers.
  • Optimal efficiency is higher in free markets, though reality always has some limitations and imperfections to detract from completely perfect allocative efficiency.
  • Markets are not efficient if it is subject to:
  • Allocative efficiency is the main means to measure the degree markets and public policy improve or harm society or other specific subgroups.
  • For example, for the U.S. to achieve an allocative efficient market, it would need to produce a lot of coffee.

• Markets are Typically Efficient

  • A perfectly competitive market with full property rights is typically efficient.
  • In absolute terms, a situation can be called economically efficient if:
  • Economists refer to two types of market efficiency.
  • A market can be perfectly efficient but highly unequal, for example.
  • While this is economically efficient, many would argue that it is not desirable.

• Externality Impacts on Efficiency

  • Economic efficiency is the use resources to maximize the production of goods; externalities are imperfections that limit efficiency.
  • An economically efficient society can produce more goods or services than another society without using more resources.
  • Positive and negative externalities both impact economic efficiency.
  • Externalities directly impact efficiency because the production of goods is not efficient when costs are incurred due to damages.
  • When market imperfections exist, the efficiency of the market declines.

• Thinking about Efficiency

  • An efficient market maximizes total consumer and producer surplus.
  • Not all markets are efficient.
  • Economists often seek to maximize efficiency, but it is important to contextualize such aims.
  • Efficiency is but one of many vying goals in an economic system, and different notions of efficiency may be complementary or may be at odds.
  • Most commonly, efficiency is contrasted or paired with morality, particularly liberty, and justice.

• Additional examples of efficient buildings

  • Low-cost technologies combined with common sense have been producing efficient structures for years.
  • Elsewhere, the California State Automobile Association office in Antioch, (the cheapest CSAA building ever built), decided to flood its 1,459 m2 interior with lighting from energy-efficient light bulbs and (free) daylight that streams in through super-insulated windows.
  • One of the most written about case studies in commercial building efficiency, however, concerns the ING Bank in Amsterdam (The Netherlands), which was built in 1987.
  • Moreover, the $3 million in annual reduced energy costs paid for the building's efficiency upgrade in three months.
  • What makes them particularly compelling is the fact that efficient buildings not only save money, they also help the businesses that reside in them make more money by providing increases in productivity and decreases in employee absenteeism.

• Carnot Cycles

  • The Carnot cycle is the most efficient cyclical process possible and uses only reversible processes through its cycle.
  • (See our atom on "Heat Engines. ") How efficient can a heat engine be then?
  • This increases heat transfer Qc to the environment and reduces the efficiency of the engine.
  • Carnot also determined the efficiency of a perfect heat engine—that is, a Carnot engine.
  • (Derivation of the formula is slightly beyond the scope of this atom. ) No real heat engine can do as well as the Carnot efficiency—an actual efficiency of about 0.7 of this maximum is usually the best that can be accomplished.

• Criteria to Evaluate Ends and Means

  • At another level, the choices of means to achieve a given end may appear to be based on efficiency.
  • Ultimately, efficiency rests on a foundation of ethics.
  • An immoral objective can be achieved "efficiently. " Nazi Germany sought "efficient" means to achieve the annihilation of an ethnic group.
  • Modern, neoclassical economics is often perceived as a study of efficiency with in the context of a very specific ethical system: "utilitarianism

• Behavior of an Efficient Market

  • Efficient-market hypothesis (EMH) asserts that financial markets are informationally efficient and should therefore move unpredictably.
  • In finance, the efficient-market hypothesis (EMH) asserts that financial markets are "informationally efficient. " As a result, one cannot consistently achieve returns in excess of average market returns on a risk-adjusted basis, given the information available at the time the investment is made.
  • Market efficiency is a simplification of the world which may not always hold true.
  • The market is practically efficient for investment purposes for most individuals.
  • The efficient-market hypothesis emerged as a prominent theory in the mid-1960's.

• It's not just photocopiers and carpets

  • Carrier is further driven to ensure that the building where it administers its cooling service is energy-efficient because the more efficient the building the better and more cost-effective its product will be, which translates into higher profits for Carrier.
  • Customers love the arrangement because Carrier'scommitment to increasing efficiency, reducing waste and lowering costs ultimately means lower all-around heating and cooling prices for consumers.
  • In a similar fashion, the Bank of Japan collaborated with Japanese power companies to facilitate the leasing of energy-efficient automobiles, home appliances and water heaters to everyday consumers.
  • The aim is to encourage and promote the development of energy-efficient appliances while reducing the nation's energy requirements, carbon emissions and waste.
  • Appliances that aren't efficient are not allowed into the program, which encourages the manufacturers of wasteful products (who want to be included in the program) to make their products more sustainable.