Universität zu Köln

Badunenko, Oleg and Kumbhakar, Subal C. (2016). When, where and how to estimate persistent and transient efficiency in stochastic frontier panel data models. Eur. J. Oper. Res., 255 (1). S. 272 - 288. AMSTERDAM: ELSEVIER. ISSN 1872-6860

Full text not available from this repository.

Abstract

In this paper we examine robustness of a recently developed panel data stochastic frontier model that allows for both persistent and transient (also known as long-run and short-run or time-invariant and time-varying) inefficiency along with random firm-effects (heterogeneity) and noise. We address some concerns that the practitioners might have about this model. First, given that there are two random time-invariant components (persistent inefficiency and firm-effects) the concern is whether the model can accurately identify them, and if so how precisely can the model estimate them? Second, there are two time-varying random components (transient inefficiency and noise), and the concern is whether the model can separate noise from transient inefficiency, and if so how precisely can the model estimate transient inefficiency? Third, how well are persistent and transient inefficiency estimated under different scenarios, viz., under different configurations of the variance parameters of the four random components? Given that the model is quite complex, relatively new and becoming quite popular in the panel efficiency literature, we feel that there is need for a detailed simulation study to examine when, where and how one can use this model with confidence to estimate persistent and transient inefficiency. (C) 2016 Elsevier B.V. All rights reserved.

Item Type:	Journal Article
Creators:	Creators Email ORCID ORCID Put Code Badunenko, Oleg UNSPECIFIED UNSPECIFIED UNSPECIFIED Kumbhakar, Subal C. UNSPECIFIED UNSPECIFIED UNSPECIFIED
URN:	urn:nbn:de:hbz:38-255633
DOI:	10.1016/j.ejor.2016.04.049
Journal or Publication Title:	Eur. J. Oper. Res.
Volume:	255
Number:	1
Page Range:	S. 272 - 288
Date:	2016
Publisher:	ELSEVIER
Place of Publication:	AMSTERDAM
ISSN:	1872-6860
Language:	English
Faculty:	Unspecified
Divisions:	Unspecified
Subjects:	no entry
Uncontrolled Keywords:	Keywords Language TECHNICAL INEFFICIENCY; HETEROGENEITY; SPECIFICATION Multiple languages Management; Operations Research & Management Science Multiple languages
Refereed:	Yes
URI:	http://kups.ub.uni-koeln.de/id/eprint/25563