This paper proposes a tail-truncated stochastic frontier model that allows for the truncation of technical efficiency from below. The truncation bound implies the inefficiency threshold for survival. Specifically, this paper assumes a uniform distribution of technical inefficiency and derives...

This paper proposes a tail-truncated stochastic frontier model that allows for the truncation of technical efficiency from below. The truncation bound implies the inefficiency threshold for survival and also can be used as a measure of market competition. Specifically, this paper assumes a...