Technical efficiency with state-contingent production frontiers using maximum entropy estimators

• Type: Article in International Scientific Journal
• Date: 2014

Authors

Pedro Macedo (Author) Other; Elvira Silva (Author) FEP; Manuel Scotto (Author) Other

Journal

Title: Journal of Productivity Analysis

Vol. 41 No. 1

Pages: 131-140

ISSN: 0895-562X

Publisher: Springer Nature

Indexing

ISI Web of Knowledge - 12 Citations

ISI Web of Science

Scopus - 14 Citations

Scientific classification

FOS: Social sciences

Other information

Authenticus ID: P-009-39K

DOI: 10.1007/s11123-012-0314-y

Abstract (EN): Although the theory of state-contingent production is well-established, the empirical implementation of this approach is still in an infancy stage. The possibility of finding a large number of states of nature, few observations per state and models affected by collinearity have led some researchers to claim the urgent need to develop robust estimation techniques. In this paper, we investigate the performance of some maximum entropy estimators to assess technical efficiency with state-contingent production frontiers. The methodological discussion and the simulation study provided in the paper reveal some of the potential of these estimators. Small mean squared error loss and small differences between the true and the estimated mean of technical efficiency show that the maximum entropy can be a powerful tool in the estimation of state-contingent production frontiers.

Language: English

Type (Professor's evaluation): Scientific

No. of pages: 10