The Measurement of Efficiency with Special Reference to Retailing

Abstract

The thesis deals with two areas: Marketing and Finance and it shows the
interconnection between them.

The starting point is an examination of the behaviour of the channel of
distribution. A behaviour model of typical channels is developed which,
empirically tested, supports the theoretical model.

In the present thesis, an attempt was first made to investigate another
hypothesis concerning the efficiency of firms in the given channel of
distribution. More specifically, the question arises, is an efficient
distributor linked with efficient suppliers and vice versa? Unfortunately,
both suppliers and distributors were unwilling to disclose data required
for such a study. The thesis therefore investigates the question of the
measurement of efficiency from a different angle, departing from Marketing.
It discusses at some length other methodologies concerned and presents
the difficulties of using them. It shows that in order to effect a
comprehensive measurement one should consider a map of utility indifference
curves. The model developed is a combination of a number of other theories,
mainly those presented by 1) Dunning and Rowan (157) which suggest the
use of utility curves rather than production curves, and 2) Amey (I) who
offers another concept - the comparison of ex-post with ex-ante profit.
In the light of these considerations the model developed in this thesis
utilizes stock market data in order to estimate ex-ante profits. For this
reason the portfolio theory is employed. The model is empirically tested
on a sample of public companies for a ten-year period, while techniques are
developed in order to deal with such data.

Date of Award	1973
Original language	English