The Effect of Employing Temporary Workers on Efficiency: Evidence From a Meta-Frontier Analysis

Koangsung Choi, Chung Choe and Daeho Lee

SAGE Open, 2021, vol. 11, issue 4, 21582440211058199

Abstract: This study examines the impact of employing temporary workers on technical efficiency (TE) by employing stochastic frontier analysis (SFA) and meta-frontier analysis (MFA). These two statistical methods yield slightly different, yet empirically meaningful, results. SFA—the more conventional methodology for conducting efficiency analysis—confirms that firms with temporary workers show a somewhat lower level of TE; while MFA, which allows a comparison of TE across groups with heterogeneous technologies, reveals that firms hiring temporary workers are technologically less efficient and have a more pronounced relative gap in efficiency. With the application of MFA, it was observed that firms hiring only temporary workers come farther to the meta-frontier than their counterparts.

Keywords: temporary worker; technical efficiency; stochastic frontier analysis; meta-frontier analysis (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:sae:sagope:v:11:y:2021:i:4:p:21582440211058199

DOI: 10.1177/21582440211058199

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