Estimating Monotone Concave Stochastic Production Frontiers

Tsionas, Mike (2021) Estimating Monotone Concave Stochastic Production Frontiers. Journal of Business and Economic Statistics. ISSN 0735-0015

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Abstract

Recent research shows that the search for Bayesian estimation of concave production functions is a fruitful area of investigation. In this article, we use a flexible cost function that satisfies globally the monotonicity and curvature properties to estimate features of the production function. Specification of a globally monotone concave production function is a difficult task which is avoided here by using the first-order conditions for cost minimization from a globally monotone concave cost function. The problem of unavailable factor prices is bypassed by assuming structure for relative prices in the first-order conditions. The new technique is shown to perform well in a Monte Carlo experiment as well as in an empirical application to rice farming in India.

Item Type:
Journal Article
Journal or Publication Title:
Journal of Business and Economic Statistics
Uncontrolled Keywords:
/dk/atira/pure/subjectarea/asjc/1800/1804
Subjects:
ID Code:
161824
Deposited By:
Deposited On:
04 Nov 2021 07:03
Refereed?:
Yes
Published?:
Published
Last Modified:
22 Nov 2021 16:50