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What is Economic Efficiency?

The late Paul Heyne writes about efficiency for The Concise Encyclopedia of Economics:

Economic Efficiency in a Nutshell organizes its explanation of efficiency differently than the way CyberEconomics explains efficiency:

Production Efficiency
Exchange Efficiency

(I have not yet found appropriate readings for these topics.)

Product-Mix Efficiency defines three types of efficiency that are equivalents to the three conditions of efficiency explained in CyberEconomics, but gives them slightly different names. For example, what CyberEconomics calls product-mix efficiency calls allocative efficiency:

Some Qualifications

One of the assumptions needed to make economic efficiency meaningful is the assumption that consumer sovereignty is a good thing. We must accept the values that people put on things as being legitimate. This entry at amosweb explains what consumer sovereignty is, but does not go much further:

These links were checked on July 5, 2008

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