S. Scholtes (Stefan)
http://repub.eur.nl/ppl/16069/
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RePub, Erasmus University RepositoryNon-Parametric Tests of Productive Efficiency with Errors-in-Variables
http://repub.eur.nl/pub/14062/
Mon, 01 Jan 2007 00:00:01 GMT<div>T. Kuosmanen</div><div>G.T. Post</div><div>S. Scholtes</div>
We develop a non-parametric test of productive efficiency that accounts for errors-in-variables, following the approach of Varian. [1985. Nonparametric analysis of optimizing behavior with measurement error. Journal of Econometrics 30(1/2), 445–458]. The test is based on the general Pareto–Koopmans notion of efficiency, and does not require price data. Statistical inference is based on the sampling distribution of the L∞ norm of errors. The test statistic can be computed using a simple enumeration algorithm. The finite sample properties of the test are analyzed by means of a Monte Carlo simulation using real-world data of large EU commercial banks.