The document provides an overview of efficiency and economic valuation, detailing types such as allocative, productive, social, and dynamic efficiency. It defines key concepts like economic efficiency, monopoly, and market failure while emphasizing the importance of avoiding waste in resource allocation. The summary concludes that economic efficiency is a condition rather than a measurable quantity, with potential indicators having both advantages and disadvantages.

1. EFFICIENCY AND ECONOMIC
VALUATION
PREPARED BY
DR.ANJALATCHI
M.SC(N)MD(AM)MBA(HA)

3. Content /learning objective
• Efficiency and economic valuation
• Introduction
• Meaning
• Type of efficiency
• Allocative efficiency
• Basic allocative efficiency
• Productivity efficiency
• Basic productivity efficiency
• Basic social efficiency
• Basic dynamic efficiency /example
• Key concept –innovative
• Monopoly-
• Market failure
• Key concept-economic efficiency

4. TERMINOLOGY USED IN TOPIC
• EFFICIENCY -Efficiency is the ability to avoid
wasting materials, energy, efforts, money, and
time in doing something or in producing a desired
result. In a more general sense, it is the ability to
do things well, successfully, and without waste
• ECONOMIC-the branch of knowledge concerned
with the production, consumption, and transfer
of wealth.
• VALUATION-an estimation of the worth of
something, especially one carried out by a
professional valuer

5. • STATIC-lacking in movement, action, or change,
especially in an undesirable or uninteresting way.
• ALLOCATIVE-Allocative efficiency is a state of the
economy in which production represents
consumer preferences; in particular, every good
or service is produced up to the point where the
last unit provides a marginal benefit to
consumers equal to the marginal cost of
producing
• relating to the allocating of resources or funds to
a particular area or for a particular purpose.
• "free market mechanisms may be vital for
allocative efficiency“
• PRODUCTIVE -producing or able to produce large
amounts of goods, crops, or other commodities.

6. • MONOPOLY-the exclusive possession or control
of the supply of or trade in a commodity or
service.
• "the state's monopoly of radio and television
broadcasting“
• DYNAMIC-(of a process or system) characterized
by constant change, activity, or progress."a
dynamic economy“
• PARETO-denoting or involving the theories and
methods of the Italian economist and sociologist
Vilfredo Pareto (1848–1923), especially a formula
used to express the income distribution of a
society.

7. Introduction of Economic Efficiency

8. Economic Efficiency

9. MODEL OF ECONOMIC EFFICIENCY

10. Type of Efficiency

11. SUFFICIENT CONDITION FOR
ECONOMIC EFFICIENCY

12. Allocative Efficiency

13. Basic of Allocation Efficiency

14. Basic of Allocative Efficiency

15. Productive Efficiency

16. Basic of protective efficiency

17. Basic of Social Efficiency

18. Basic of Dynamic Efficiency

19. Example of Dynamic Efficiency

20. Competition policy in the news

21. Key concept –innovative Market

22. Monopoly and Allocative Inefficiency

23. Market failure and lost efficiency

24. Key concept –Economic efficiency

25. SUMMARY
• Economic efficiency is different than most
traditional measures of WUE – it is a set of
conditions, not a quantity measured on a
scale of 0-100% Indicators of economic
efficiency can be developed, but all have pros
and cons 5

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