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Definition Of:

Efficiency

Bible DictionaryEnvironmental Economics Dictionary
The allocation of goods to their uses of highest relative value.
Bible DictionaryDictionary of Political Economy
In an economic sense, the ratio or proportionality between the value of the human end achieved ("benefits" or "satisfactions") and the value of the scarce resources expended to achieve it ("opportunity costs"). When an economist calls a situation or a practice "inefficient," he is claiming that we could achieve exactly the same desired goals with the expenditure of fewer scarce resources, or, put another way, that the amount of resources being employed could potentially produce even more of the beneficial results intended than they do. Efficiency simply means making the most we can of the limited resources we have.

Notice that "efficiency" in the economist's sense is an inherently evaluative term, not a matter of mere technical or scientific measurement of objective physical quantities, as the term might be used in an engineering context (as for example, the "efficiency" of various kinds of steam engine in transforming heat energy to useful kinetic energy). "Value of" always requires some sort of answer to the question "value to whom." When we assess the efficiency of any process or social institution or practice, just whose evaluations of the means and the ends are we using? In a well-developed market economy, assessment of economic efficiency makes heavy use of the monetary values placed on the various inputs and the resulting outputs in the open marketplace. The valuations that count are thus the valuations of those who are willing and able to support their preferences by spending their money in the ways that seem to them most likely to maximize their own satisfactions or "utility" based on their own individual tastes and preferences. The evidence that any particular economic resource is being used efficiently is, in the end, the fact that no one finds it "worth his while" to bid up the price and pay more in order to divert it to some other use.

The logical and philosophical elaboration of the idea that competitive market systems are highly efficient in a much broader sense even than this is the primary content of Adam Smith's classic work The Wealth of Nations (1776). Indeed the entire subdivision of today's economic science known as "welfare economics" specializes primarily in identifying and analyzing the necessary preconditions for voluntary market interactions to generate socially efficient outcomes (and in examining the possibilities for remedies by deliberate state economic policies where those necessary preconditions may not be fully met).

Bible DictionaryLearning & Performance Dictionary
A measure (as a percentage) of the actual output to the standard output expected. Efficiency measures how well someone is performing relative to expectations.

 

Social Science Dictionary INDEX:


List of Terms: Terms beginning with "A", Page 1

Starts With:  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z 3
Page Number:  1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19

A: Page 1 of 19.

AAGRA
AAR
ABOLFAZL SHADVAR
ABSOLUTE POVERTY
ACCRUED INTEREST
ACHIEVED STATUS
ACID RAIN
ACUTE DISEASE
ADAPTATION
ADJUSTED GROSS ...AERO
AFFIRMATIVE ACT...
AG
AGE GRADES
AGE STRUCTURE
AGEISM
AGENCIES OF SOC...AGRA
AGRARIAN SOCIET...AGRIBUSINESS
AIDS (Acquired ...
AIR POLLUTION
ALAA
ALIENATION
ANDROGYNY
ANIMISM
ANOMIA
ANOMIE
ANOMIE THEORY
ANTHROPOLOGY
APARTHEID
APEC
APG
APPROPRIATE TEC...ARMS RACE
ARMS TRADE
ARRANGED MARRIA...ASCRIBED STATUS
ASSET PROTECTIO...
ASSETS
ASSIMILATION
AUTHORITARIAN P...
AUTHORITY
AUTOCRATIC RULE
AUTOMATION
Abatement
Abbey
Abbot
Ability-to-Pay ...Ablutophobia
Absolute Advant...
Absolute advant...Abundance
Acarophobia
Accelerator
Acceptance
Acceptance-reje...
Accolade
Accoutrement
Acerophobia
Acheronophobia
Achluophobia
Acid Rain
Acousticophobia
Acquired Endowm...Acquittal
Acre
Acrophobia
Act of Parliame...
Acting Speaker
Active Alumni M...Adaptive Expect...
Additive
Address in Repl...Administrator o...
Admiral
Adoubement
Advance estimate
Adventurous Shi...Adverse Selecti...Aeroacrophobia
Aeronausiphobia
Aerophobia
Affection
Agency problem
Agency problem ...Agency problem ...
Aggregate Deman...Aggregate Expen...Aggregate Suppl...
Aggregate demand
Aggregate supply
Aggression
Agincourt, Batt...Agliophobia
Agoraphobia
Agraphobia
Agrizoophobia
Agyrophobia

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