On the Distribution of Estimated Technical Efficiency in Stochastic Frontier Models: Revisited

Anup Kumar Bhandari
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Anup Kumar Bhandari: Centre for Development Studies, IndiaUniversity, U.K.

International Journal of Business and Economics, 2011, vol. 10, issue 1, 69-80

Abstract: Both theoretical and empirical literatures on the stochastic frontier production model have been substantially enriched since 1977. However, attempts to derive the distribution of the estimated one-sided error term, even under restricted assumptions, have only recently been provided. This study attempts to derive the distribution of the estimated one-sided inefficiency error and several important statistical properties under fairly general assumptions. We also derive the distribution of estimated technical efficiency and provide an empirical illustration.

Keywords: stochastic frontier; inefficiency error; estimated technical efficiency; leather industry (search for similar items in EconPapers)
JEL-codes: C34 D24 (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (2)

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