On estimation of monotone and concave frontier functions

Irène Gijbels, Enno Mammen, Byeong U. Park and Leopold Simar
Additional contact information
Irène Gijbels: Institut de Statistique, Université catholique de Louvain, Louvain-la-Neuve, Belgium
Byeong U. Park: Department of Statistics, Seoul National University, North Korea

No 1997031, LIDAM Discussion Papers CORE from Université catholique de Louvain, Center for Operations Research and Econometrics (CORE)

Abstract: A way for measuring the efficiency of enterprises is via the estimation of the so-called production frontier, which is the upper boundary of the support of the population density in the input and output space. It is reasonable to assume that the production frontier is a concave monotone function. Then, a famous estimator is the data envelopment analysis (DEA) estimator, which is the lowest concave monotone increasing function covering all sample points. This estimator is biased downwards since it never exceeds the true production frontier. In this paper we derive the asymptotic distribution of the DEA estimator, which enables us to assess the asymptotic bias and hence to propose an improved bias corrected estimator. This bias corrected estimator involves consistent estimation of the density function as well as of the second derivative of the production frontier. We also discuss briefly the construction of asymptotic confidence intervals. The finite sample performance of the bias corrected estimator is investigated via a simulation study and the procedure is illustrated for a real data example.

Keywords: Asymptotic distribution; bias correction; confidence interval; data envelopment analysis; density support; frontier function (search for similar items in EconPapers)
Date: 1997-04-01
References: Add references at CitEc
Citations: View citations in EconPapers (12)

Downloads: (external link)
https://sites.uclouvain.be/core/publications/coredp/coredp1997.html (text/html)

Related works:
Working Paper: On estimation of monotone and concave frontier functions (1999)
Working Paper: On estimation of monotone and concave frontier functions (1998)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cor:louvco:1997031

Access Statistics for this paper

More papers in LIDAM Discussion Papers CORE from Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) Voie du Roman Pays 34, 1348 Louvain-la-Neuve (Belgium). Contact information at EDIRC.
Bibliographic data for series maintained by Alain GILLIS ().