On the Measurement of Economic Capacity Utilization for Multi-Product Industries

Abstract

This paper considers capacity utilization measures for the multiproduct firm. The single-product dual measure of capacity utilization easily extends to the multiproduct case. Three possible extensions of the single-product primal measure are considered. Although each has its limitations because of the restrictions embodied in it, each provides different, yet potentially useful, information about capacity utilization in a multiproduct industry. The dual and primal measures of the multiproduct capacity utilization are applied to the multi-species New England fishing industry to evaluate the potential for capacity expansion under a regulatory program of license limitation.

Source: Segerson, K. and D. Squires. 1990. “On the measurement of economic capacity utilization for multi-product industries.” Journal of Econometrics, 44(3): 347-361.

For more information, please contact: Dale.Squires@noaa.gov