An Alternative Specification for Technical Efficiency Effects in a Stochastic Frontier Production Function

Paul, Satya; Shankar, Sriram

doi:10.2139/ssrn.2913313

Cited by 6 publications

(5 citation statements)

References 26 publications

(26 reference statements)

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“…It is based on the concept that a production system can be defined by a series of smooth and continuously differentiable concave production transformation functions, with the frontier representing the limit of all feasible production outcomes. This method offers the benefit of concurrently estimating the individual technical efficiency of participating farmers and identifying the factors influencing their technical efficiency (Paul et al, 2017). The initial specification of this approach includes a production function with two components: one to accommodate random effects and another to quantify technical efficiency.…”

Section: Stochastic Production Frontier Modelmentioning

confidence: 99%

Efficiency of oil palm production in Nigeria: A review-pathway

ASHORO Collins Ovwigho,

EMAZIYE Peter Otunaruke,

OVHARHE Oghenero Joseph

2024

World J. Adv. Res. Rev.

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The study reviewed the efficiency of oil palm production in Nigeria. Efficiency plays a major role in productivity in developing economies like Nigeria, where resources are limited and new technology must be adopted quickly to boost output. The research gaps addressed were: provision of reasonable data backing the efficiency of oil palm production, inquiry into the technical efficiency dynamics of the oil palm making, appraising the dynamics disturbing the oil palm making, addressing the sustainability of oil palm making, reviewing the problems and prospects connected with the oil palm commerce. The factors affecting the technical efficiency of oil palm fruit processing which includes a decline in production and yields, limited availability of specific fertilizers, scarcity of quality palm seedlings, aging palm plantations, limited access to suitable credit options, marketing challenges, including stiff competition from imported oils, inefficient palm oil extraction using traditional methods due to the prevalence of a poorly mechanized artisanal sector and limited access to credit tailored for palm nut processing. It was discovered that Oil palm making has a significant impact on employment in Nigeria. The problems associated with the efficiency of oil palm production include deforestation and habitat loss, environmental impact, social and labour issues, land tenure and conflict. Among the prospects of oil palm efficiency, alternative oil sources, technology and yield improvement, restoration and reforestation, consumer awareness and demand for sustainable products were optimal. It was concluded that the pathway of oil palm-making efficiency in Nigeria from 1980 to 2023 reflects a dynamic industry resulting by economic growth, environmental stability, technological and social compatibility. It is recommended that to enhance efficiency in oil palm, farmers ought to allocate greater resources to their production endeavours to align with the rising market demand and to enhance their profit margins.

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Section: Stochastic Production Frontier Modelmentioning

confidence: 99%

Efficiency of oil palm production in Nigeria: A review-pathway

ASHORO Collins Ovwigho,

EMAZIYE Peter Otunaruke,

OVHARHE Oghenero Joseph

2024

World J. Adv. Res. Rev.

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“…Parametric stochastic frontier models with the scaling property are normally estimated by nonlinear least squares (e.g. Simar et al 1994;Deprins and Simar 1989;Paul and Shankar 2017;Parmeter and Kumbhakar 2014) or ML (e.g. Simar et al 1994;Wang and Schmidt 2002)).…”

Section: The Modelmentioning

confidence: 99%

Semi-parametric modelling of inefficiencies in stochastic frontier analysis

Forchini

Theler

2022

J Prod Anal

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We propose a novel penalized splines method to estimate a stochastic frontier model in which the frontier is linear and the inefficiency has a single index structure with unknown link function and a linear index. The approach is more flexible than the traditional methodology requiring a parametric link function and, at the same time, it does not incur the curse of dimensionality as a fully non-parametric approach. The procedure can be easily implemented using existing software. We give conditions for the model to be identified and provide some asymptotic results. We also use Monte Carlo simulations to show that the approach works well in finite samples in many situations when compared to the well specified maximum likelihood estimator. An application to the residential energy demand of US states is considered. In this case, the penalized splines approach estimates inefficiency functions that deviate substantially from those resulting from parametric maximum likelihood methods previously implemented.

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“…An interesting extension of this idea was recently proposed by [81] for the setting where u i has already been converted into technical efficiency. In this case the level of inefficiency must be bound between 0 and 1.…”

Section: Estimation Without Imposing Distributional Assumptionsmentioning

confidence: 99%

“…In this case the level of inefficiency must be bound between 0 and 1. To account for this [81] model, the impact of z on the level of inefficiency through a probit function. Again, given the nonlinear nature of the probit function, this necessitates the use of NLS if one wishes to eschew distributional assumptions.…”

Section: Estimation Without Imposing Distributional Assumptionsmentioning

confidence: 99%