Formulation and estimation of stochastic frontier production function models? (Reprinted from Journal of Econometrics Vol 6, pg 21-37, 1977)

Previous studies of the so-called frontier production function have not utilized an adequate characterization of the disturbance term for such a model. In this paper we provide an appropriate specification, by defining the disturbance term as the sum of symmetric normal and (negative) half-normal random variables. Various aspects of maximum-likelihood estimation for the coefficients of a production function with an additive disturbance term of this sort are then considered. (c) 2023 Published by Elsevier B.V.