An Average Derivative Estimation of Stochastic Frontiers

Cliff Huang and Tsu-Tan Fu

Journal of Productivity Analysis, 1999, vol. 12, issue 1, 45-53

Abstract: This paper utilizes the average derivative estimation of Stoker (1986) and the pesudo-likelihood estimation of Fan, Li, and Weersink (1996) to estimate a semiparametric stochastic frontier regression, y=g(x) + ε, where the function g(.)is unknown and ε is a composite error in a standard setting. The proposed semiparametric method of estimation is applied to data on farmers' credit unions in Taiwan. Empirical results show that the banking services of the farmers' credit unions is subject to economies of scale, but high degree of cost inefficiency in operation. Copyright Kluwer Academic Publishers 1999

Keywords: Average derivative estimation; semiparametric stochastic frontier; efficiency measurement; Taiwan farmers' credit unions (search for similar items in EconPapers)
Date: 1999
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:kap:jproda:v:12:y:1999:i:1:p:45-53

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DOI: 10.1023/A:1007851023468

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