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Environmental efficiency measurement with translog distance functions: A parametric approach

  • Cuesta, Rafael A.
  • Lovell, C.A. Knox
  • Zofío, José L.

We introduce new specifications and estimation procedures of traditional distance functions that allow researchers to undertake environmental efficiency and productivity studies within a parametric stochastic framework. Relying on a translog distance function specification that treats the outputs' vector asymmetrically by allowing equiproportional desirable outputs expansion and undesirable outputs contraction, we discuss the relevant properties that characterize the environmental hyperbolic distance function, and show that it can be easily implemented using conventional econometric techniques based on maximum likelihood estimation. We illustrate our model estimating technical efficiency scores for a panel of U.S. electricity generating units that produce electricity and SO2 emissions as byproduct.

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Article provided by Elsevier in its journal Ecological Economics.

Volume (Year): 68 (2009)
Issue (Month): 8-9 (June)
Pages: 2232-2242

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Handle: RePEc:eee:ecolec:v:68:y:2009:i:8-9:p:2232-2242
Contact details of provider: Web page: http://www.elsevier.com/locate/ecolecon

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  2. Ball, V. Eldon & Lovell, C.A. Knox & Luu, H. & Nehring, Richard F., 2004. "Incorporating Environmental Impacts in the Measurement of Agricultural Productivity Growth," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 29(03), December.
  3. Catherine J. Morrison Paul & Warren E. Johnston & Gerald A. G. Frengley, 2000. "Efficiency in New Zealand Sheep and Beef Farming: The Impacts of Regulatory Reform," The Review of Economics and Statistics, MIT Press, vol. 82(2), pages 325-337, May.
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  20. Christensen, Laurits R & Jorgenson, Dale W & Lau, Lawrence J, 1973. "Transcendental Logarithmic Production Frontiers," The Review of Economics and Statistics, MIT Press, vol. 55(1), pages 28-45, February.
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