Technical Efficiency

Dear sir,

please tell me how can i simoly define the "Technical Efficiency" in a simplest form.please explain this with an example,so i get the point.

Thanks & Regards

Shazia

Dear Shazia

Technical efficiency means that are transformed into goods and services without waste, that producers are doing the best job possible of combining resources to make goods and services. There is no waste of material inputs. There are no workers standing idly around waiting for spare parts. The maximum amount of physical outputs is obtained from the given resource inputs. In essence, production is achieved at the lowest possible . For example in Health Sector if we have decided to invest in Primary Health Care, then technical Efficiency means that within PHC, how can we achieve our PHC goals and objectives with minimum of resources, of if we have for example two different strategies for achieving PHC with have the same cost, then which will give us the maximum outputs for the given inputs.
Technical efficiency is a prerequisite for allocative or economic efficiency. Economic efficiency is achieved if the highest possible level of satisfaction is obtained from given resources. Because satisfaction is derived from
consuming goods and services, economic efficiency requires the greatest possible level of production, that is, technical efficiency.
However, while technical efficiency is necessary for economic efficiency, it does not guarantee economic efficiency. While technical efficiency might be achieved in the production of purple spotted stuffed animals,
allocative efficiency is not achieved if no one actually wants purple spotted stuffed animals and they remain stored in a big purple warehouse.

I hope that clarifies