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On the Distribution of Estimated Technical Efficiency in Stochastic Frontier Models: Revisited

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  • Anup Kumar Bhandari

    (Centre for Development Studies, IndiaUniversity, U.K.)

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    Abstract

    Both theoretical and empirical literatures on the stochastic frontier production model have been substantially enriched since 1977. However, attempts to derive the distribution of the estimated one-sided error term, even under restricted assumptions, have only recently been provided. This study attempts to derive the distribution of the estimated one-sided inefficiency error and several important statistical properties under fairly general assumptions. We also derive the distribution of estimated technical efficiency and provide an empirical illustration.

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    Bibliographic Info

    Article provided by College of Business, and College of Finance, Feng Chia University, Taichung, Taiwan in its journal International Journal of Business and Economics.

    Volume (Year): 10 (2011)
    Issue (Month): 1 (April)
    Pages: 69-80

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    Handle: RePEc:ijb:journl:v:10:y:2011:i:1:p:69-80

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    Related research

    Keywords: stochastic frontier; inefficiency error; estimated technical efficiency; leather industry;

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    Cited by:
    1. Gómez-Gallego, Juan Cándido & Gómez-García, Juan & Pérez-Cárceles, María Concepción, 2012. "Appropriate Distribution of Cost Inefficiency Estimates as Predictor of Financial Instability /La distribución de la ineficiencia estimada como predictor de inestabilidad financiera," Estudios de Economía Aplicada, Estudios de Economía Aplicada, vol. 30, pages 1071 (12 pa, Diciembre.

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