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From |
Scott Merryman <scott.merryman@gmail.com> |

To |
statalist@hsphsun2.harvard.edu |

Subject |
Re: st: XTFRONTIER: How to interpret Total Efficiency Measures |

Date |
Tue, 13 Apr 2010 11:27:05 -0500 |

On Mon, Apr 5, 2010 at 11:09 AM, Victor Waters <vvwaters@gmail.com> wrote: > Dear StataListers, > > I am a little confused about the magnitude of the total efficiency > measure. My XTFRONTIER with time varying decay model, > runs well, almost all of the coefficients are as expected., > > My total efficiency measures (for all units) are very low - between .1 > and .25. What importance should I attach to this? > Does it mean all of the units are very inefficient? Or the model is misspecified. <snip> > If eta is not 0, can I compare ti and tvd efficiency measures? There is a significance test for eta to distinguish between the two models. In the example below, the tvd model has efficiency estimates on that are very low - the average less than 0.003 while the average efficiency estimates for the ti model is about 0.50. However, one a time trend is added to the model (capturing technological progress), the efficiency estimates are similar. . webuse grunfeld,clear . gen lninvest = ln(invest) . gen lnmval = ln(mval) . . qui xtfrontier lninvest lnmval, ti nolog . predict te_ti, te . . qui xtfrontier lninvest lnmval , tvd nolog . predict te_tvd, te . . sum te* Variable | Obs Mean Std. Dev. Min Max -------------+-------------------------------------------------------- te_ti | 200 .490895 .2736979 .1121026 .9170025 te_tvd | 200 .0027195 .0019911 .0001452 .0087726 . . qui xtfrontier lninvest lnmval time, ti nolog . predict te2_ti, te . . qui xtfrontier lninvest lnmval time, tvd nolog . predict te2_tvd, te . . sum te2* Variable | Obs Mean Std. Dev. Min Max -------------+-------------------------------------------------------- te2_ti | 200 .3899374 .2795348 .0356406 .9245906 te2_tvd | 200 .4083181 .2734767 .0326259 .9357629 Scott * * For searches and help try: * http://www.stata.com/help.cgi?search * http://www.stata.com/support/statalist/faq * http://www.ats.ucla.edu/stat/stata/

**References**:**st: XTFRONTIER: How to interpret Total Efficiency Measures***From:*Victor Waters <vvwaters@gmail.com>

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