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From |
"Dev Vencappa" <lexdvv@nottingham.ac.uk> |

To |
<statalist@hsphsun2.harvard.edu> |

Subject |
Re: st: option predict te for cost frontier in stata 8.2 |

Date |
Mon, 20 Jun 2005 01:57:53 +0100 |

> > Stata users, I made a typo in the previous email which may have confused some users, so I'm posting it again. I was running the frontier command for both a production and a cost function. While I understand that the option predict te retrieves the efficiency scores ranging between 0 and 1, when I was running the cost function I was a bit confused with the scores retrieved from the cost frontier. I got values ranging from close to 1 onwards, and I understand these need to be bound between 0 and 1. Am I right in assuming that the correct cost efficiency scores are just the inverse of the predicted efficiency scores from the predict te option? I suppose Stata is simply computing these scores in a similar way as for the production frontier, i.e. actual output/maximum output, so actual cost/minimum cost instead of minimum cost/actual cost? Thanks in advance for any guidance on this. Dev Dev Vencappa School of Economics University of Nottingham University Park Nottingham NG7 2RD U.K. Tel : +44 (0)115 951 5608 Fax: +44 (0) 115 951 4159 This message has been checked for viruses but the contents of an attachment may still contain software viruses, which could damage your computer system: you are advised to perform your own checks. Email communications with the University of Nottingham may be monitored as permitted by UK legislation. * * For searches and help try: * http://www.stata.com/support/faqs/res/findit.html * http://www.stata.com/support/statalist/faq * http://www.ats.ucla.edu/stat/stata/ Dev Vencappa School of Economics University of Nottingham University Park Nottingham NG7 2RD U.K. Tel : +44 (0)115 951 5608 Fax: +44 (0) 115 951 4159 This message has been checked for viruses but the contents of an attachment may still contain software viruses, which could damage your computer system: you are advised to perform your own checks. Email communications with the University of Nottingham may be monitored as permitted by UK legislation. * * For searches and help try: * http://www.stata.com/support/faqs/res/findit.html * http://www.stata.com/support/statalist/faq * http://www.ats.ucla.edu/stat/stata/

**Follow-Ups**:**RE: st: option predict te for cost frontier in stata 8.2***From:*"Scott Merryman" <smerryman@kc.rr.com>

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