This article examines the empirical performance of alternative frontier estimators' ability to replicate a known underlying technology and economic measures such as multi-product and product-specific economies of scale, and economies of scope. A cross sectional Monte Carlo procedure to simulate...

A typical (roughly) two-digit industry in the United States appears to have constant or slightly decreasing returns to scale. Three puzzles emerge, however. First, estimates often rise at higher levels of aggregation. Second, apparent decreasing returns contradicts evidence of only small...