Document Type

Working Paper

Date

2006

Embargo Period

6-28-2012

Keywords

latent class regression, EC algorithm, stochastic production frontier, technical efficiency

Language

English

Disciplines

Economics

Description/Abstract

Stochastic production frontier models are used extensively in the agricultural and resource economics literature to estimate production functions and technical efficiency, as well as to guide policy. Traditionally these models assume that each agent's production can be specified as a representative, homogeneous function. This paper proposes the synthesis of a latent class regression and an agricultural production frontier model to estimate technical efficiency while allowing for the possibility of production heterogeneity. We use this model to estimate a latent class production function and efficiency measures for vessels in the Northeast Atlantic herring fishery. Our results suggest that traditional measures of technical efficiency may be incorrect, if heterogeneity of agricultural production exists.

Additional Information

Harvest from RePEc at http://repec.org

Source

Metadata from RePEc

Included in

Economics Commons

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