On constant elasticity of substitution - Constant elasticity of transformation Directional Distance Functions

This paper aims to present non-linear CES (Constant Elasticity of Substitution)-CET (Constant Elasticity of Transformation) Directional Distance Functions. These measures inherit the structure of the standard Directional Distance Functions and that of the CES-CET technology. These functions allow non-parametric estimation of efficiency scores through linear programming method. Besides, the CES -CET technology gives the opportunity to explore α-returns to scale assumption for the new distance functions. The duality theory is investigated through pseudo profit, cost and revenue functions. The dual standpoint provides non-linear adjusted prices that can occur into non-linear pricing practices. An application is proposed to give an illustrative example of the primal CES-CET Directional Distance Functions.