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Bias Free Measurement of Technical Efficiency

Bhide, Shashanka; Kalirajan, Kaliappa


Technical efficiency, which is a measure of production performance of a firm, has been estimated generally using a primal production frontier. Since the estimation is carried out for a given level of inputs, the efficiency measure includes the effect of 'input-mix' or 'input-allocation' and consequently, the technical efficiency estimate is biased. The objectives of this paper are to gauge the magnitude of 'input-mix' bias in technical efficiency estimate and to suggest a method to measure...[Show more]

CollectionsANU Research Publications
Date published: 2006
Type: Journal article
Source: Journal of Applied Statistics
DOI: 10.1080/02664760600585592


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