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Do we estimate an input or an output distance function? An application of the mixture approach to European railways

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  • Subal Kumbhakar
  • Luis Orea
  • Ana Rodríguez-Álvarez
  • Efthymios Tsionas

Abstract

In this paper, we estimate parametric input and output distance functions and discuss how to estimate a mixture/latent class model (LCM) involving the output and input distance functions in the context of multi-input and multi-output production technology. The proposed technique is applied to a panel data on European Railways (1971–1994). This model allows us to identify determinants of the efficiency orientation, thereby providing useful information that can help researchers to choose between the input and the output-oriented approaches. In addition, we develop cross-indices that can be used to compute input (output) technical inefficiency from the estimates of output (input) distance function. Copyright Springer Science+Business Media, LLC 2007

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  • Subal Kumbhakar & Luis Orea & Ana Rodríguez-Álvarez & Efthymios Tsionas, 2007. "Do we estimate an input or an output distance function? An application of the mixture approach to European railways," Journal of Productivity Analysis, Springer, vol. 27(2), pages 87-100, April.
    • Handle: RePEc:kap:jproda:v:27:y:2007:i:2:p:87-100
    DOI: 10.1007/s11123-006-0031-5
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    2. Latruffe, Laure & Bravo-Ureta, Boris E. & Moreira, Victor H. & Desjeux, Yann & Dupraz, Pierre, 2011. "Productivity and Subsidies in European Union Countries: An Analysis for Dairy Farms Using Input Distance Frontiers," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114396, European Association of Agricultural Economists.
    3. Wang, Sun Ling & Newton, Doris J., 2015. "Productivity and Efficiency of U.S. Field Crop Farms: A Look at Farm Size and Operator’s Gender," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 205344, Agricultural and Applied Economics Association.
    4. Daniel Solís & Boris E. Bravo‐Ureta & Ricardo E. Quiroga, 2009. "Technical Efficiency among Peasant Farmers Participating in Natural Resource Management Programmes in Central America," Journal of Agricultural Economics, Wiley Blackwell, vol. 60(1), pages 202-219, February.
    5. Régina D.C. Bonou-zin & Khalil Allali & Aziz Fadlaoui, 2019. "Environmental Efficiency of Organic and Conventional Cotton in Benin," Sustainability, MDPI, vol. 11(11), pages 1-17, May.
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    7. Heike Wetzel, 2008. "Productivity Growth in European Railways: Technological Progress,Efficiency Change and Scale Effects," Working Paper Series in Economics 101, University of Lüneburg, Institute of Economics.
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    11. Nguyen, Huy, 2014. "Crop diversification, economic performance and household’s behaviours Evidence from Vietnam," MPRA Paper 59090, University Library of Munich, Germany.
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    14. Rahman, Sanzidur, 2009. "Whether crop diversification is a desired strategy for agricultural growth in Bangladesh?," Food Policy, Elsevier, vol. 34(4), pages 340-349, August.
    15. Orea, Luis, 2019. "The Econometric Measurement of Firms’ Efficiency," Efficiency Series Papers 2019/02, University of Oviedo, Department of Economics, Oviedo Efficiency Group (OEG).
    16. Inmaculada C. Álvarez & Luis Orea & Alan Wall, 2023. "Estimating the propagation of both reported and undocumented COVID-19 cases in Spain: a panel data frontier approximation of epidemiological models," Journal of Productivity Analysis, Springer, vol. 59(3), pages 259-279, June.
    17. Ogundari, K. & Brümmer, Bernhard, 2011. "Estimating Technical Efficiency, Input substitution and complementary effects using Output Distance Function: A study of Cassava production in Nigeria," Agricultural Economics Review, Greek Association of Agricultural Economists, vol. 12(2).
    18. Latruffe, Laure & Bravo-Ureta, Boris E. & Moreira, Victor H. & Desjeux, Yann & Dupraz, Pierre, 2012. "Productivity and Subsidies in the European Union: An Analysis for Dairy Farms Using Input Distance Frontiers," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 126846, International Association of Agricultural Economists.
    19. Marchetti, Dalmo & Wanke, Peter, 2017. "Brazil's rail freight transport: Efficiency analysis using two-stage DEA and cluster-driven public policies," Socio-Economic Planning Sciences, Elsevier, vol. 59(C), pages 26-42.
    20. Sanzidur Rahman & Basanta Kumar Barmon, 2018. "Total Factor Energy Productivity and Efficiency Changes of the Gher (Prawn-Carp-Rice) Farming System in Bangladesh: A Stochastic Input Distance Function Approach," Energies, MDPI, vol. 11(12), pages 1-17, December.
    21. Rahman, Sanzidur & Barmon, Basanta K., 2012. "Energy productivity and efficiency of the ‘gher’ (prawn-fish-rice) farming system in Bangladesh," Energy, Elsevier, vol. 43(1), pages 293-300.
    22. Haider Alzubaidi & Spiros Bougheas, 2012. "The Impact of the Global Financial Crisis on European Banking Efficiency," Discussion Papers 12/05, University of Nottingham, Centre for Finance, Credit and Macroeconomics (CFCM).
    23. Collier, Trevor & Johnson, Andrew L. & Ruggiero, John, 2011. "Technical efficiency estimation with multiple inputs and multiple outputs using regression analysis," European Journal of Operational Research, Elsevier, vol. 208(2), pages 153-160, January.

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