Advanced Robust And Nonparametric Methods in Efficiency Analysis

by Daraio, Cinzia; Simar, Leopold

• ISBN13: 9780387351551
• ISBN10: 0387351558
• Format: Hardcover
• Copyright: 2007-03-23
• Publisher: Springer Verlag

Summary

The main objective of Advanced Robust and Nonparametric Methods in Efficiency Analysis is to provide a systematic and comprehensive treatment of recent developments in efficiency analysis in order to overcome these drawbacks. In Part I of the book (Methodology), we introduce a complete set of tools for measuring the efficiency of firms and for explaining the observed efficiency differentials. In Part II of the book (Applications), we propose three empirical illustrations taken from different economic fields: scientific research, mutual funds industry and the insurance sector.This book has been specifically designed for applied economists who have an interest in the advantages of traditional nonparametric methods (DEA/FDH) for efficiency analysis, but are sceptical about adopting them because of the drawbacks they present. They will find a complete and up to date presentation of the advances made in nonparametric frontier analysis able to overcome most of the drawbacks of traditional methods.

Table of Contents

Dedication	p. v
List of Figures	p. xi
List of Tables	p. xv
Preface	p. xvii
Acknowledgments	p. xxi
Introduction	p. 1
What this work is about	p. 1
Improving the nonparametric approach in frontier analysis	p. 4
An outline of the work	p. 8
Methodology
The Measurement of Efficiency	p. 13
Productivity and Efficiency	p. 13
A short history of thought	p. 16
The economic model	p. 19
A taxonomy of efficient frontier models	p. 25
The nonparametric frontier approach	p. 30
Data Envelopment Analysis (DEA)	p. 31
Free Disposal Hull (FDH)	p. 33
Recent developments in nonparametric efficiency analysis	p. 39
Statistical Inference in Nonparametric Frontier Estimation	p. 43
Statistical foundation	p. 43
Introducing stochastic noise in the model	p. 45
Asymptotic results	p. 47
Consistency	p. 47
Sampling distributions	p. 49
Bootstrap techniques and applications	p. 50
Bootstrap in frontier models	p. 52
Correcting the bias	p. 54
Bootstrap confidence intervals	p. 55
Is the bootstrap consistent?	p. 56
Applications of the bootstrap	p. 63
Bootstrapping FDH estimators	p. 64
Nonparametric Robust Estimators: Partial Frontiers	p. 65
A re-formulation based on the probability of being dominated	p. 66
Order-m frontiers and efficiency scores	p. 68
Order-¿ quantile-type frontiers	p. 72
Properties of partial frontier estimators	p. 77
Statistical properties	p. 77
Robust estimators of the full frontier	p. 77
Advantages of using partial frontiers	p. 78
Detection of outliers	p. 79
Summary of the results for the output oriented case	p. 81
Parametric approximations of robust nonparametric frontiers	p. 85
Two stage methods	p. 87
The bootstrap algorithms	p. 89
Multivariate parametric approximations	p. 90
Generalized Cobb-Douglas parametric model	p. 91
Translog parametric model	p. 93
Conditional Measures of Efficiency	p. 95
Explaining efficiency in the literature	p. 96
Introducing external-environmental variables	p. 100
Conditional full frontier measures	p. 100
Conditional order-m measures	p. 101
Conditional order-¿ measures	p. 103
Summary for the output oriented case	p. 105
Bandwidth selection	p. 108
Univariate case	p. 109
Multivariate case	p. 110
An econometric methodology	p. 113
Global effect of Z on the production process	p. 113
A decomposition of conditional efficiency	p. 119
Simulated illustrations	p. 121
Univariate Z	p. 122
Multivariate Z	p. 124
Applications
Economies of Scale, Scope and Experience in the Italian Motor-Vehicle Sector	p. 135
Introduction	p. 135
Data description	p. 139
Definition of outputs and inputs	p. 142
An exploratory investigation	p. 145
Aggregation of inputs and outputs	p. 148
Testing returns to scale and bootstrapping efficiency scores	p. 151
Economies of scale	p. 157
Economies of scope	p. 160
Economies of experience	p. 163
Conclusions	p. 164
Age, Scale and Concentration Effects in a Public Research System	p. 167
Introduction	p. 167
Data description	p. 176
Scale and concentration effects	p. 178
Age effects on CNR scientific productivity	p. 181
Robust parametric approximation of multioutput distance function	p. 186
Conclusions	p. 191
Exploring the Effects of Manager Tenure, fund Age and their Interaction	p. 193
Introduction	p. 193
Data description	p. 196
Impact of mutual fund manager tenure on performance	p. 199
Interaction between manager tenure and fund age	p. 208
Conclusions	p. 216
Conclusions	p. 217
References	p. 221
Topic Index	p. 243
Author Index	p. 245
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