Comparison of stochastic frontier approaches for estimating national efficiency: an application to sub-Saharan African countries

Michael Danquah , B Ouattara

Research output: Contribution to journalArticlepeer-review

Abstract

In this paper, we attempt to estimate pure national (technical) efficiency for 19 SSA countries over the 1960-2010 periods. In doing this, we compare conventional stochastic frontier models for panel data with a number of recently developed models which seek to control for unobserved heterogeneity in the inefficiency component. We find that the ‘true’ random effects model that treats unobserved heterogeneity in our national dataset generates more reasonable efficiency estimates. Moreover the results confirm that most SSA countries operate far from the efficient frontier.
Original languageEnglish
JournalJournal of Economic Development
Publication statusAccepted/In press - 2 Jul 2018

Keywords

  • National efficiency
  • Productivity
  • Stochastic frontier model
  • Sub-Saharan Africa

Research Beacons, Institutes and Platforms

  • Global Development Institute

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