Overview
Production Dominance
Production dominance is a concept that demonstrates clearly when one production function is more efficient than the other. Given two production sets {% (\vec{x}_1, \vec{y}_1),(\vec{x}_2, \vec{y}_2) %}, set 2 is dominant to set 1 if {% \vec{x}_1 \geq \vec{x}_2 %} and {% \vec{y}_1 \leq \vec{y}_2 %}. That is, the second production function produces more output while using fewer inputs. When the inequalities are strict, we call the dominance strict dominance.Among all possible production values, there is a set of efficient production points where each point is not strictly dominated by any other point.