Productivity studies that use proxy variable estimators routinely specify single-output production functions despite most firms producing multiple outputs. This is usually accomplished by aggregating the firm's outputs using total revenue. Such a formulation rarely provides an adequate...

This article uses panel data estimation techniques to examine technical efficiency of individual dairy farms in northern Germany. To the extent that agricultural production is characterised by heterogeneous production conditions, estimation techniques that do not account for unobserved...

From an empirical perspective, this paper critically examines the concepts of returns to scale (RTS) and economies of scale (EOS), and argues that the concept of EOS is more relevant and broader enough to exhibit proper scale economies behavior of firms. Two approaches, i.e., production function...

Control function approaches to estimating production functions rely on a proxy that is monotone in an unobserved scalar productivity conditioning on other state variables. Ackerberg, Caves, and Frazer (2015) point out a potential functional dependence problem when conditioning only on capital....

We study Ackerberg, Caves, and Frazer (2015)'s production function estimation method using Monte Carlos simulations. First, we replicate their results by using the same procedure and confirm the existence, as noted by ACF, of a spurious minimum in the estimation. In the population, or when the...

When benchmarking production units by non-parametric methods like data envelopment analysis (DEA), an assumption has to be made about the returns to scale of the underlying technology. Moreover, it is often also relevant to compare the frontiers across samples of producers. Until now, no exact...

The field of production frontier estimation is divided between the parametric Stochastic Frontier Analysis (SFA) and the deterministic, nonparametric Data Envelopment Analysis (DEA). This paper explores an amalgam of DEA and SFA that melds a nonparametric frontier with a stochastic composite...

The regression residual is commonly used as a productivity indicator. However, the observed input demands are endogenous if rational managers adjust their input use for inefficiency. A large stream of studies considers possible solutions to the endogeneity problem that require as little external...

Objective: This study proposes a novel empirical analysis of the total factor productivity (TFP) growth for Polish microenterprises, focusing on the effect of the global lockdown in 2020. We employed firm-level data covering enterprises with below ten employees to evaluate micro-firms'...