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A Comparison Of Various Frontier Estimation Methods Under Differing Data Generation Assumptions

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  • Settlage, Daniel M.
  • Dixon, Bruce L.
  • Thomsen, Michael R.

Abstract

Monte Carlo methods examine the accuracy of several production frontier approximating forms, estimators and methods to rank firms by level of predicted technical efficiency. Results show stochastic frontier methods superior to data envelopment analysis. The Cobb-Douglas approximating form is superior to the translog or generalized Leontief.

Suggested Citation

  • Settlage, Daniel M. & Dixon, Bruce L. & Thomsen, Michael R., 2000. "A Comparison Of Various Frontier Estimation Methods Under Differing Data Generation Assumptions," Staff Papers 15773, University of Arkansas, Department of Agricultural Economics and Agribusiness.
    • Handle: RePEc:ags:uarksp:15773
    DOI: 10.22004/ag.econ.15773
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    References listed on IDEAS

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    1. Forsund, Finn R. & Lovell, C. A. Knox & Schmidt, Peter, 1980. "A survey of frontier production functions and of their relationship to efficiency measurement," Journal of Econometrics, Elsevier, vol. 13(1), pages 5-25, May.
    2. Gong, Byeong-Ho & Sickles, Robin C., 1992. "Finite sample evidence on the performance of stochastic frontiers and data envelopment analysis using panel data," Journal of Econometrics, Elsevier, vol. 51(1-2), pages 259-284.
    3. Dixon, Bruce L & Garcia, Philip & Anderson, Margot, 1987. "Usefulness of Pretests for Estimating Underlying Technologies Using Dual Profit Functions," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 28(3), pages 623-633, October.
    4. Hanoch, Giora, 1971. "CRESH Production Functions," Econometrica, Econometric Society, vol. 39(5), pages 695-712, September.
    5. Guilkey, David K & Lovell, C A Knox & Sickles, Robin C, 1983. "A Comparison of the Performance of Three Flexible Functional Forms," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 24(3), pages 591-616, October.
    6. Jondrow, James & Knox Lovell, C. A. & Materov, Ivan S. & Schmidt, Peter, 1982. "On the estimation of technical inefficiency in the stochastic frontier production function model," Journal of Econometrics, Elsevier, vol. 19(2-3), pages 233-238, August.
    7. Paul J. Driscoll & Richard Boisvert, 1991. "Dual Second- and Third-Order Translog Models of Production," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 73(4), pages 1146-1160.
    8. Bauer, Paul W., 1990. "Recent developments in the econometric estimation of frontiers," Journal of Econometrics, Elsevier, vol. 46(1-2), pages 39-56.
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    Cited by:

    1. Grace Lordan, 2007. "Measuring efficiency in health care: an application to out of hours primary care services in the island of Ireland," Health, Econometrics and Data Group (HEDG) Working Papers 07/08, HEDG, c/o Department of Economics, University of York.

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