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