Article ID Journal Published Year Pages File Type
5062592 Economics Letters 2007 6 Pages PDF
Abstract

“Within” estimation of the fixed-effect stochastic frontier model does not identify parameters on time-invariant explanatory variables. If time-invariant variables are important production inputs, then standard efficiency estimates are biased. This note details bias correction, when time-invariant inputs are dummy variables.

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Social Sciences and Humanities Economics, Econometrics and Finance Economics and Econometrics
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Fixed-effect estimation of technical efficiency with time-invariant dummies
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