PROPER EFFICIENCY AND THE THEORY OF VECTOR MAXIMIZATION
RAND CORP SANTA MONICA CA
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The report discusses a redefinition of the fundamental concept of efficiency to eliminate certain anomalous situations. The resulting new definition, called proper efficiency, is related to the notion of proper efficiency introduced by Kuhn and Tucker in 1950. However, the present definition avoids some of the drawbacks inherent in the earlier one. A comprehensive theory of vector maximization is constructed using the new definition, with and without various constraint qualification, convexity, and differentiability assumptions. The theory includes as a special case the standard theory of nonlinear programming.
- Operations Research