Semiparametric smooth-coefficient stochastic frontier model

Kai Sun and Subal Kumbhakar

Economics Letters, 2013, vol. 120, issue 2, 305-309

Abstract: This paper proposes a semiparametric smooth-coefficient (SPSC) stochastic production frontier model where regression coefficients are unknown smooth functions of environmental factors (Z). Technical inefficiency is specified in the form of a parametric scaling function which also depends on the Z variables. Thus, in our SPSC model the Z variables affect productivity directly via the technology parameters as well as through inefficiency. A residual-based bootstrap test of the relevance of the environmental factors in the SPSC model is suggested. An empirical application is also used to illustrate the technique.

Keywords: Semiparametric smooth-coefficient model; Stochastic frontier; Environmental factors (search for similar items in EconPapers)
JEL-codes: C14 C16 Q12 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (22)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:120:y:2013:i:2:p:305-309

DOI: 10.1016/j.econlet.2013.05.001

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