A Normal-Half Normal Distributed Stochastic
Cost Frontier Model

Shameena.H.Khan; L. Mary Louis

doi:https://doi.org/10.14445/22315373/IJMTT-V38P521

International Journal of Mathematics Trends and Technology

Research Article | Open Access | Download PDF

Volume 38 | Number 3 | Year 2016 | Article Id. IJMTT-V38P521 | DOI : https://doi.org/10.14445/22315373/IJMTT-V38P521

A Normal-Half Normal Distributed Stochastic Cost Frontier Model

Shameena.H.Khan, L. Mary Louis

Citation :

Shameena.H.Khan, L. Mary Louis, "A Normal-Half Normal Distributed Stochastic Cost Frontier Model," International Journal of Mathematics Trends and Technology (IJMTT), vol. 38, no. 3, pp. 119-124, 2016. Crossref, https://doi.org/10.14445/22315373/IJMTT-V38P521

Abstract

Stochastic Cost Frontier Model (SCFM) plays a major role in measuring Cost Efficiency Scores (CES) in the field of production. The present study is an attempt to derive the cost efficiency of normal half normal stochastic cost frontier model. The parameters were evaluated using Maximum likelihood Estimates. In the model ݒ~௜ܰ)0, ߪ௩ ଶ), is a two sided error term representing the statistical noise and ݑ ≤ ௜0 is one sided error term representing cost efficiency.

Keywords

Normal-Half normal distribution, Stochastic Cost Frontier Model, Cost Efficiency scores

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