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Semiparametric stochastic metafrontier efficiency of European manufacturing firms

Author

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  • Marijn Verschelde

    () (IÉSEG School of Management, LEM (UMR-CNRS 9221)
    KU Leuven)

  • Michel Dumont

    (Federal Planning Bureau
    Ghent University)

  • Glenn Rayp

    (Ghent University)

  • Bruno Merlevede

    (Ghent University)

Abstract

Abstract In this paper a semiparametric stochastic metafrontier approach is used to obtain insight into the performance of manufacturing firms in Europe. We differ from standard TFP studies at the firm level as we simultaneously allow for inefficiency , noise and do not impose a functional form on the input–output relation. Using AMADEUS firm-level data covering ten manufacturing sectors from seven EU15 countries, (1) we document substantial and persistent differences in performance (with Belgium and Germany as benchmark countries and Spain lagging behind) and a wide technology gap, (2) we confirm the absence of convergence in TFP between the seven selected countries, (3) we highlight a more pronounced technology gap for smaller firms.

Suggested Citation

  • Marijn Verschelde & Michel Dumont & Glenn Rayp & Bruno Merlevede, 2016. "Semiparametric stochastic metafrontier efficiency of European manufacturing firms," Journal of Productivity Analysis, Springer, vol. 45(1), pages 53-69, February.
  • Handle: RePEc:kap:jproda:v:45:y:2016:i:1:d:10.1007_s11123-015-0458-7
    DOI: 10.1007/s11123-015-0458-7
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    Cited by:

    1. repec:eee:ejores:v:269:y:2018:i:3:p:1013-1026 is not listed on IDEAS
    2. Michel Dumont & Chantal Kegels, 2016. "Working Paper 06-16 - Young Firms and Industry Dynamics in Belgium," Working Papers 1606, Federal Planning Bureau, Belgium.
    3. Lee, Chi-Chuan & Huang, Tai-Hsin, 2017. "Cost efficiency and technological gap in Western European banks: A stochastic metafrontier analysis," International Review of Economics & Finance, Elsevier, vol. 48(C), pages 161-178.

    More about this item

    Keywords

    Productive efficiency; Metafrontier estimation; Semiparametric frontier; Kernel estimation; Stochastic frontier; Manufacturing;

    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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