Larger context for LACK in Corpus USbrown_UKbncw/UK_bncw.txt
The implication of this is that any policy proposal for a particular industry can only be made after an investigation of not only the structure of the industry, but also of the objectives and conduct of the firms within it.
Thirdly, in economic theory it is presumed that any level of output is always produced at the lowest technically feasible cost.
For the economist, inefficiency arises because the wrong level of output is produced.
However, in the real world there is an additional concept of efficiency, which takes cognisance of the fact that real firms are never as technically efficient as the theorists' firm.
lack > This type of inefficiency arises because workers and management are often ill-equipped or lack ing in motivation and so do not perform to the best of their abilities.
Inefficiency of this sort, which involves a given level of output being produced at a cost which is higher than the theoretical minimum, is termed X- inefficiency.
It is what management and business schools try to eradicate through education and training.
It is what the common man understands by "inefficiency".
Clearly such inefficiency is incompatible with perfectcompetition where the competitive threat would be sufficient to remove any less efficient firm.