Uncovering X-inefficiency: The Hidden Source of Organizational Inefficiencies
The X-efficiency theory distinguishes between the concept of X-inefficiency and the theory that explains it. X-inefficiency is like technical inefficiency, but it focuses on non-allocative inefficiencies in organizations. Leibenstein introduced X-inefficiency because other concepts didn't cover all the elements involved in these inefficiencies. The term 'X-inefficiency' was used to describe these substantial sources of inefficiencies.