Identifying technically efficient fishing vessels: a non-empty, minimal subset approach
AbstractStochastic frontier models are often employed to estimate fishing vessel technical efficiency. Under certain assumptions, these models yield efficiency measures that are means of truncated normal distributions. We argue that these measures are flawed, and use the results of Horrace (2005) to estimate efficiency for 39 vessels in the Northeast Atlantic herring fleet, based on each vessel's probability of being efficient. We develop a subset selection technique to identify groups of efficient vessels at pre-specified probability levels. When homogeneous production is assumed, inferential inconsistencies exist between our methods and the methods of ranking the means of the technical inefficiency distributions for each vessel. When production is allowed to be heterogeneous, these inconsistencies are mitigated. Copyright © 2007 John Wiley & Sons, Ltd.
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Bibliographic InfoArticle provided by John Wiley & Sons, Ltd. in its journal Journal of Applied Econometrics.
Volume (Year): 22 (2007)
Issue (Month): 4 ()
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Web page: http://www.interscience.wiley.com/jpages/0883-7252/
Other versions of this item:
- Alfonso Flores-Lagunes & William C. Horrace & Kurt E. Schnier, 2006. "Identifying Technically Efficient Fishing Vessels: A Non-Empty, Minimal Subset Approach," Center for Policy Research Working Papers 78, Center for Policy Research, Maxwell School, Syracuse University.
- C12 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Hypothesis Testing: General
- C16 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Econometric and Statistical Methods; Specific Distributions
- D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
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