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A quantile-based approach for relative efficiency measurement

✍ Scribed by Paul M. Griffin; Paul H. Kvam


Publisher
John Wiley and Sons
Year
1999
Tongue
English
Weight
80 KB
Volume
20
Category
Article
ISSN
0143-6570

No coin nor oath required. For personal study only.

✦ Synopsis


Two popular approaches for efficiency measurement are a non-stochastic approach called data envelopment analysis (DEA) and a parametric approach called stochastic frontier analysis (SFA). Both approaches have modeling difficulty, particularly for ranking firm efficiencies. In this paper, a new parametric approach using quantile statistics is developed. The quantile statistic relies less on the stochastic model than SFA methods, and accounts for a firm's relationship to the other firms in the study by acknowledging the firm's influence on the empirical model, and its relationship, in terms of similarity of input levels, to the other firms.


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