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Harvey Leibenstein was a Ukrainian-born American economist. One of his most important contributions to economics was the concept of x-efficiency.
In economics, x-efficiency is the effectiveness with which a given set of inputs are used to produce outputs. If a firm is producing the maximum output it can, given the resources it employs, such as men and machinery, and the best technology available, it is said to be technical-efficient. x-inefficiency occurs when technical-efficiency is not achieved. The concept of x-efficiency was introduced by Harvey Leibenstein in his paper Allocative efficiency v. "x-efficiency" in American Economic Review 1966.
The concept of x-efficiency is also used in the theory of bureaucracy.
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