Yes, fizzit, they can be as ineff as the person making the selection wants them to be (like perez who must be a mech eng).
But use some common sense and some basic info like here: http://www.roymech.co.uk/Useful_Tables/Drive/Gear_Efficiency.html
You will come to find out they can be designed close to 98% eff.
The problem lies w/ ppl who want the RPM, opting for the 5:1 rather than the slower 75:1 ratio. Children equate RPM w/ speed, and think it is critical. Can U imagine an output of 10,000 RPM in direct drive w/ the hub

. No not practical, esp when the torque is measured in inch pounds.
Please give me more put downs, I like showing how energy REALLY works to the laymen. My favorite thing to do is learn, but usually wind up having to teach (which is actually the best way to learn).
PS Look @ this Mongoose, U got a gear reduction then the 90deg gear then a chain, then another chain. How eff do u think the energy is getting from the bat? Being they are in series U multiply the eff of each in series. I will say each is 95% eff, most will be higher, but the motor (the 1st component) is likely lower. So: .95(bat2motor)x.95(int gear reduction)x.95(90angle)x.95(chain2pedal)x.95(pedal2tire)= .773 So if a direct drive worm gear is 78% eff or better, U get more energy to the pavement than A SYSTEM W/ THESE PARAMETERS. 99% eff is not easy to achieve w/o high maintenance, chains can be as low as 80% eff. KISS (keep it simple stupid)