Metafrontier frameworks for the study of firm-level efficiencies and technology ratios

Abstract

This paper uses the concept of a metafrontier to compare the technical efficiencies of firms that may be classified into different groups. The paper presents the basic analytical framework necessary for the definition of a metafrontier, shows how a metafrontier can be estimated using non-parametric and parametric methods, and presents an empirical application using cross country agricultural sector data. The paper also explores the issues of technological change, time-varying technical inefficiency, multiple outputs, different efficiency orientations, and firm heterogeneity.