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Applied Economics Letters Volume 10, 2003 - Issue 11
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Original Articles

An alternative method for predicting technical inefficiency in stochastic frontier models

Yoshihiko Tsukuda Tohoku University, Graduate School of Economics, Kawauchi, Aoba-ku, Sendai, 980-8576, Japan
&
Tatsuyoshi Miyakoshi University of Tsukuba, Institute of Policy and Planning Sciences, Tsukuba, Ibaraki, 305-8573, Japan
Pages 667-670 | Published online: 04 Jun 2010
 
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Abstract

The median is proposed as an alternative to the expectation of the conditional distribution in order to predict the technical inefficiency in stochastic frontier production models with panel data. Numerical comparison reveals that the two predictors can take different values when the distribution is skewed.

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