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quality of that process. This saying popular in business, however, obscures the more common sense of "effectiveness", which would/should produce the following mnemonic: "Efficiency is doing things right; effectiveness is getting things done". This makes it clear that effectiveness, for example large production numbers, can also be achieved through inefficient processes if, for example, workers are willing or used to working longer hours or with greater physical effort than in other companies or countries or if they can be forced to do so. Similarly, a company can achieve effectiveness, for example large production numbers, through inefficient processes if it can afford to use more energy per product, for example if energy prices or labor costs or both are lower than for its competitors.
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refers to a situation in which the distribution of resources between alternatives does not fit with consumer taste (perceptions of costs and benefits). For example, a company may have the lowest costs in "productive" terms, but the result may be inefficient in allocative terms because the "true" or
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of useful output to total useful input. Effectiveness is the simpler concept of being able to achieve a desired result, which can be expressed quantitatively but does not usually require more complicated mathematics than addition. Efficiency can often be expressed as a percentage of the result that
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A common but confusing way of distinguishing between efficiency and effectiveness is the saying "Efficiency is doing things right, while effectiveness is doing the right things". This saying indirectly emphasizes that the selection of objectives of a production process is just as important as the
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says that we could produce the given output at a lower cost—or could produce more output for a given cost. For example, a company that is inefficient will have higher operating costs and will be at a competitive disadvantage (or have lower profits than other firms in the market). See
Sickles and
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In more mathematical or scientific terms, it signifies the level of performance that uses the least amount of inputs to achieve the highest amount of output. It often specifically comprises the capability of a specific application of effort to produce a specific outcome with a minimum amount or
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refers to a situation where "we could be doing a better job," i.e., attaining our goals at lower cost. It is the opposite of economic efficiency. In the latter case, there is no way to do a better job, given the available resources and technology. Sometimes, this type of economic efficiency is
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could ideally be expected, for example if no energy were lost due to friction or other causes, in which case 100% of fuel or other input would be used to produce the desired result. In some cases efficiency can be indirectly quantified with a non-percentage value, e.g.
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refers to inefficiency in the "black box" of production, connecting inputs to outputs. This type of inefficiency says that we could be organizing people or production processes more effectively. Often problems of "morale" or
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said: "Resource efficiency means using the Earth's limited resources in a sustainable manner while minimising impacts on the environment. It allows us to create more with less and to deliver greater value with less input."
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results from barriers of mobility in labor markets which prevent workers from moving to places and occupations where there are job vacancies. Thus, unemployed workers can co-exist with unfilled job vacancies.
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is a situation in which one person can not be made better off without making anyone else worse off. In practice, this criterion is difficult to apply in a constantly changing world, so many emphasize
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Writer
Deborah Stone notes that efficiency is "not a goal in itself. It is not something we want for its own sake, but rather because it helps us attain more of the things we value."
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of wealth, in theory, suggests that more egalitarian distributions of wealth are more efficient than inegalitarian distributions. Distributive inefficiency is often associated with
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and inefficiency: a situation is inefficient if someone can be made better off even after compensating those made worse off, regardless of whether the compensation actually occurs.
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Resource-market inefficiency refers to barriers that prevent full adjustment of resource markets, so that resources are either unused or misused. For example,
50:, energy, efforts, money, and time while performing a task. In a more general sense, it is the ability to do things well, successfully, and without waste.
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quantity of waste, expense, or unnecessary effort. Efficiency refers to very different inputs and outputs in different fields and industries. In 2019, the
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exceeds the price that consumers are willing to pay for an extra unit of the product. This is true, for example, if the firm produces pollution (see also
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are quantified in compatible units, and if consumables are transformed into products via a conservative process. For example, in the analysis of the
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Useful work per quantity of energy, mechanical advantage over ideal mechanical advantage, often denoted by the Greek lowercase letter η (
452:(criterion for quality) in systems design and systems architecture which says something about the resource consumption for given load
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inefficiency might be defined as incomplete use of resources (labor, capital goods, natural resources, etc.) because of inadequate
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Efficiency is often measured as the ratio of useful output to total input, which can be expressed with the mathematical formula
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Productive inefficiency, resource-market inefficiency, and X-inefficiency might be analyzed using
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refers to the inefficient distribution of income and wealth within a society. Decreasing
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is never greater than 100% (and in fact must be even less at finite temperatures).
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Market efficiency, the extent to which a given market resembles the ideal of an
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is the amount of useful output ("product") produced per the amount
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Measurement of
Productivity and Efficiency: Theory and Practice
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may be the amount of useful work output, while the consumable
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is the absence of efficiency. Kinds of inefficiency include:
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is the amount of high-temperature heat input. Due to the
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Zelenyuk (2019, Chapter 3) for more extensive discussions.
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Degree to which a process minimizes waste of resources
561:. Water Resources Development and Management: 39–69.
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Policy paradox: the art of political decision making
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42:is the often measurable ability to avoid making
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604:. New York: W. W. Norton & Company Inc.
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535:". Cambridge: Cambridge University Press.
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464:, effectiveness of computer data storage
531:Sickles, R., and Zelenyuk, V. (2019). "
135:referred to as the Koopmans efficiency.
70:Efficiency is very often confused with
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555:"Sefficiency (Sustainable Efficiency)"
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559:Transparent Water Management Theory
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378:Productivity improving technologies
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299:Energy conversion efficiency
238:energy conversion efficiency
66:Efficiency and effectiveness
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567:10.1007/978-981-15-6284-6_4
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33:Efficiency (disambiguation)
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450:non-functional requirement
264:can never be greater than
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491:Photosynthetic efficiency
482:Administrative efficiency
276:In science and technology
202:data envelopment analysis
118:Distributive inefficiency
458:, in data communications
268:, and so the efficiency
20:Not to be confused with
600:Stone, Deborah (2012).
470:Efficiency (statistics)
401:Kaldor-Hicks efficiency
208:Mathematical expression
196:" cause X-inefficiency.
183:structural unemployment
175:Productive inefficiency
169:Kaldor-Hicks efficiency
149:, while suffering from
145:. We are not attaining
103:Allocative inefficiency
443:Algorithmic efficiency
258:conservation of energy
541:10.1017/9781139565981
496:Ecological efficiency
407:Allocative efficiency
340:Volumetric efficiency
304:Mechanical efficiency
294:Electrical efficiency
204:and similar methods.
151:cyclical unemployment
132:Economic inefficiency
632:Engineering concepts
334:Radiation efficiency
317:Efficient energy use
194:bureaucratic inertia
31:For other uses, see
622:Economic efficiency
553:Haie, Naim (2021).
476:Material efficiency
427:Efficiency Movement
421:Business efficiency
383:Economic efficiency
322:In thermodynamics:
165:Pareto inefficiency
126:economic inequality
56:European Commission
642:Waste of resources
462:Storage efficiency
365:Grating efficiency
359:Quantum efficiency
353:Faraday efficiency
348:Lift-to-drag ratio
309:Thermal efficiency
122:marginal utilities
576:978-981-15-6283-9
456:Efficiency factor
434:In other sciences
395:Pareto efficiency
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637:Waste management
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234:consumables
108:social cost
46:or wasting
616:Categories
516:References
281:In physics
40:Efficiency
139:Keynesian
48:materials
504:See also
224:, where
44:mistakes
26:Efficacy
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270:r
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