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A selection of relevant issues in applied stochastic frontier analysis

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  • Antonio Alvarez
  • Carlos Arias

Abstract

This paper provides a concise review of a broad set of concepts, models and estimation issues in the field of stochastic frontier analysis. The goal is to provide practitioners with a quick guide to some key ideas. The review is restricted to single-output models estimated by econometric methods. Among the conceptual issues are the interpretation and the paths to reduce inefficiency. The modelling and estimation parts deal with topics such as explaining inefficiency, time-varying inefficiency and firm heterogeneity.

Suggested Citation

  • Antonio Alvarez & Carlos Arias, 2014. "A selection of relevant issues in applied stochastic frontier analysis," Economics and Business Letters, Oviedo University Press, vol. 3(1), pages 3-11.
  • Handle: RePEc:ove:journl:aid:10357
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    File URL: http://www.unioviedo.es/reunido/index.php/EBL/article/view/10357
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    References listed on IDEAS

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    12. Álvarez, Antonio & Arias, Carlos, 2013. "Are dairy farms becoming more intensive? Impact on farm efficiency," Efficiency Series Papers 2013/01, University of Oviedo, Department of Economics, Oviedo Efficiency Group (OEG).
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    27. Álvarez, Antonio & del Corral, Julio, 2006. "Separating Catch-up and Technical Change in Stochastic Frontier Models. A Monte Carlo Approach," Efficiency Series Papers 2006/03, University of Oviedo, Department of Economics, Oviedo Efficiency Group (OEG).
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    Cited by:

    1. Bahta, Sirak & Baker, Derek, 2015. "Determinants of Profit Efficiency Among Smallholder Beef Producers in Botswana," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association (IFAMA), vol. 18(3).
    2. repec:bla:presci:v:96:y:2017:i:4:p:843-858 is not listed on IDEAS
    3. Álvarez, Antonio & Garduño, Rafael & Núñez, Héctor, 2016. "Modelling the effect of crime on economic activity: The case of Mexican states," Efficiency Series Papers 2016/01, University of Oviedo, Department of Economics, Oviedo Efficiency Group (OEG).
    4. González, Eduardo & Cárcaba, Ana & Ventura, Juan, 2015. "How car dealers adjust prices to reach the product efficiency frontier in the Spanish automobile market," Omega, Elsevier, vol. 51(C), pages 38-48.

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