Recent Advances in the Panel Stochastic Frontier Models: Heterogeneity, Endogeneity and Dependence
This paper primarily reviews the panel stochastic frontier (SF) model in which the composite error term [Formula: see text] has four components, i.e. [Formula: see text] where [Formula: see text] and [Formula: see text] are the persistent and transient inefficiency components, [Formula: see text] is...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
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World Scientific Publishing
2022-03-01
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| Series: | International Journal of Empirical Economics |
| Subjects: | |
| Online Access: | https://www.worldscientific.com/doi/10.1142/S2810943022500020 |
| _version_ | 1827091035340144640 |
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| author | Subal C. Kumbhakar Hung-Pin Lai |
| author_facet | Subal C. Kumbhakar Hung-Pin Lai |
| author_sort | Subal C. Kumbhakar |
| collection | DOAJ |
| description | This paper primarily reviews the panel stochastic frontier (SF) model in which the composite error term [Formula: see text] has four components, i.e. [Formula: see text] where [Formula: see text] and [Formula: see text] are the persistent and transient inefficiency components, [Formula: see text] is the random firm effect and [Formula: see text] is the random noise. We discuss a variety of model specifications of the four-component SF panel model and estimation approaches developed mostly during the period 2014 to 2021. While discussing these models, we focus on the following issues: heterogeneity, endogeneity of inputs/output(s), inclusion of determinants of inefficiencies via their variances and dependence among the error components. Additionally, we examined models that introduce allocative inefficiency. Models that use both multi-step and system approaches to model allocative inefficiency are also examined. |
| first_indexed | 2024-03-11T21:25:45Z |
| format | Article |
| id | doaj.art-415b4fc00fff40418035779f2af1cd6f |
| institution | Directory Open Access Journal |
| issn | 2810-9430 2810-9449 |
| language | English |
| last_indexed | 2025-03-20T05:49:54Z |
| publishDate | 2022-03-01 |
| publisher | World Scientific Publishing |
| record_format | Article |
| series | International Journal of Empirical Economics |
| spelling | doaj.art-415b4fc00fff40418035779f2af1cd6f2024-10-03T02:52:58ZengWorld Scientific PublishingInternational Journal of Empirical Economics2810-94302810-94492022-03-01010110.1142/S2810943022500020Recent Advances in the Panel Stochastic Frontier Models: Heterogeneity, Endogeneity and DependenceSubal C. Kumbhakar0Hung-Pin Lai1Department of Economics, State University of New York at Binghamton, Binghamton, NY 13902, USADepartment of Economics, National Chung Cheng University, Chiayi, Taiwan, ROCThis paper primarily reviews the panel stochastic frontier (SF) model in which the composite error term [Formula: see text] has four components, i.e. [Formula: see text] where [Formula: see text] and [Formula: see text] are the persistent and transient inefficiency components, [Formula: see text] is the random firm effect and [Formula: see text] is the random noise. We discuss a variety of model specifications of the four-component SF panel model and estimation approaches developed mostly during the period 2014 to 2021. While discussing these models, we focus on the following issues: heterogeneity, endogeneity of inputs/output(s), inclusion of determinants of inefficiencies via their variances and dependence among the error components. Additionally, we examined models that introduce allocative inefficiency. Models that use both multi-step and system approaches to model allocative inefficiency are also examined.https://www.worldscientific.com/doi/10.1142/S2810943022500020Panel dataendogeneitypersistent inefficiencytransient inefficiencyallocative inefficiencyproxy variable |
| spellingShingle | Subal C. Kumbhakar Hung-Pin Lai Recent Advances in the Panel Stochastic Frontier Models: Heterogeneity, Endogeneity and Dependence International Journal of Empirical Economics Panel data endogeneity persistent inefficiency transient inefficiency allocative inefficiency proxy variable |
| title | Recent Advances in the Panel Stochastic Frontier Models: Heterogeneity, Endogeneity and Dependence |
| title_full | Recent Advances in the Panel Stochastic Frontier Models: Heterogeneity, Endogeneity and Dependence |
| title_fullStr | Recent Advances in the Panel Stochastic Frontier Models: Heterogeneity, Endogeneity and Dependence |
| title_full_unstemmed | Recent Advances in the Panel Stochastic Frontier Models: Heterogeneity, Endogeneity and Dependence |
| title_short | Recent Advances in the Panel Stochastic Frontier Models: Heterogeneity, Endogeneity and Dependence |
| title_sort | recent advances in the panel stochastic frontier models heterogeneity endogeneity and dependence |
| topic | Panel data endogeneity persistent inefficiency transient inefficiency allocative inefficiency proxy variable |
| url | https://www.worldscientific.com/doi/10.1142/S2810943022500020 |
| work_keys_str_mv | AT subalckumbhakar recentadvancesinthepanelstochasticfrontiermodelsheterogeneityendogeneityanddependence AT hungpinlai recentadvancesinthepanelstochasticfrontiermodelsheterogeneityendogeneityanddependence |