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A model for technical inefficiency effects in a stochastic frontier production function for panel data

A model for technical inefficiency effects in a stochastic frontier production function for panel... A stochastic frontier production function is defined for panel data on firms, in which the non-negative technical inefficiency effects are assumed to be a function of firm-specific variables and time. The inefficiency effects are assumed to be independently distributed as truncations of normal distributions with constant variance, but with means which are a linear function of observable variables. This panel data model is an extension of recently proposed models for inefficiency effects in stochastic frontiers for cross-sectional data. An empirical application of the model is obtained using up to ten years of data on paddy farmers from an Indian village. The null hypotheses, that the inefficiency effects are not stochastic or do not depend on the farmer-specific variables and time of observation, are rejected for these data. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Empirical Economics Springer Journals

A model for technical inefficiency effects in a stochastic frontier production function for panel data

Empirical Economics , Volume 20 (2) – Feb 5, 2005

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References (20)

Publisher
Springer Journals
Copyright
Copyright © 1995 by Physica-Verlag
Subject
Economics; Econometrics; Statistics for Business, Management, Economics, Finance, Insurance; Economic Theory/Quantitative Economics/Mathematical Methods
ISSN
0377-7332
eISSN
1435-8921
DOI
10.1007/BF01205442
Publisher site
See Article on Publisher Site

Abstract

A stochastic frontier production function is defined for panel data on firms, in which the non-negative technical inefficiency effects are assumed to be a function of firm-specific variables and time. The inefficiency effects are assumed to be independently distributed as truncations of normal distributions with constant variance, but with means which are a linear function of observable variables. This panel data model is an extension of recently proposed models for inefficiency effects in stochastic frontiers for cross-sectional data. An empirical application of the model is obtained using up to ten years of data on paddy farmers from an Indian village. The null hypotheses, that the inefficiency effects are not stochastic or do not depend on the farmer-specific variables and time of observation, are rejected for these data.

Journal

Empirical EconomicsSpringer Journals

Published: Feb 5, 2005

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