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This paper is concerned with the estimation of stochastic frontier production functions with unbalanced panel data when unobservable firm efficiency levels are related to explanatory variables. ≪We use the weighted-means≫ Instrumental Variables method acknowledged to R. Gardner (1998) which...
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Consider a stochastic frontier model with one-sided inefficiency u, and suppose that the scale of u depends on some variables (firm characteristics) z. A “one-step” model specifies both the stochastic frontier and the way in which u depends on z, and can be estimated in a single step, for...
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