Stationary Points for Parametric Stochastic Frontier Models

Author(s)/Creator(s)

William C. Horrace, Syracuse UniversityFollow
Ian A. Wright, Northeastern UniversityFollow

Description/Abstract

The results of Waldman (1982) on the Normal-Half Normal stochastic frontier model are generalized using the theory of the Dirac delta (Dirac, 1930), and distribution-free conditions are established to ensure a stationary point in the likelihood as the variance of the inefficiency distribution goes to zero. Stability of the stationary point and "wrong skew" results are derived or simulated for common parametric assumptions on the model. Identification is discussed.

Document Type

Working Paper

Date

Fall 11-2016

Keywords

Inefficiency Estimation, Ordinary Least Squares, Singular Distribution, Dirac Delta, Generalized Function

Language

English

Series

Working Papers Series

Disciplines

Econometrics | Economics | Macroeconomics | Statistical Models

ISSN

1525-3066

Additional Information

Working paper no. 196

Recommended Citation

Horrace, William C. and Wright, Ian A., "Stationary Points for Parametric Stochastic Frontier Models" (2016). Center for Policy Research. 228.
https://surface.syr.edu/cpr/228

Source

Local input

Creative Commons License

This work is licensed under a Creative Commons Attribution 3.0 License.