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The influence on the results of selecting a wrong distribution for the inefficiency term is also analysed.ĪIGNER, D.J. The problems of wrong skewness and absence of random error are also addressed. According to the results obtained through the mean bias and the mean squared error of the parameters and efficiencies, and via Spearman rank correlation between actual and estimated efficiencies, a good performance of the model is only obtained when considering medium-sized or large samples and the variance of the inefficiencies highly contributes to that of the composite error. In this paper, a simulation experiment is carried out in the framework of the normal/half-normal stochastic frontier model in order to analyse its ability to disentangle the two types of errors that form the composite error. Universidad de Sevilla, Facultad de CC.EE., Sevilla, España.Į- mail: Models, Stochastic Frontier, Maximum Likelihood, Monte Carlo.
