Working papers, Department of Economics, WU (Wirtschaftsuniversität Wien)
A Statistical Framework for Estimating Output-Specific Efficiencies
Abstract: This paper presents a statistical framework for estimating
output-specific efficiencies for the 2-output case based upon a DEA
frontier estimate. The key to the approach is the concept of target
output-mix. Being usually unobserved, target output-mixes of firms are
modelled as missing data. Using this concept the relevant data generating
process can be formulated. The resulting likelihood function is
analytically intractable, so a data augmented Bayesian approach is proposed
for estimation purposes. This technique is adapted to the present purpose.
Some implementation issues are discussed leading to an empirical Bayes
setup with data informed priors. A prove of scale invariance is
Keywords: Data Envelopment Analysis; output specific efficiency; data augmentation; Markov Chain Monte Carlo; (follow links to similar papers)
JEL-Codes: D24; C11; C15; (follow links to similar papers)
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