Abstract
The stochastic frontier model remains popular within the field of efficiency analysis and yet it remains deeply connected to the notion of a conditional mean. Recent research has attempted to conceive of, and estimate, the stochastic frontier model in a quantile setting. We demonstrate here that the stochastic frontier corresponds explicitly to a specific quantile of the output distribution and provide a computational approach to recover this quantile. An empirical illustration demonstrates comparable performance with more classical methods of estimation of the stochastic frontier model.
| Original language | English (US) |
|---|---|
| Pages (from-to) | 15-18 |
| Number of pages | 4 |
| Journal | Economics Letters |
| Volume | 182 |
| DOIs | |
| State | Published - Sep 1 2019 |
Keywords
- Efficiency
- Quantile function
- Skewed normal
- True quantile
ASJC Scopus subject areas
- Finance
- Economics and Econometrics
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Jradi, S., Parmeter, C., & Ruggiero, J. (2019). Quantile estimation of the stochastic frontier model. Economics Letters, 182, 15-18. https://doi.org/10.1016/j.econlet.2019.05.038