Abstract
This paper assesses the implications of relaxing some of the distributional assumptions that characterize most composed error formulations of frontier cost and production function models appearing in the literature. Generalized method of moments (GMM) estimation procedures are presented that enable various degrees of distributional flexibility that are typically difficult to attain in likelihood-based approaches to estimation of frontier models. Moment-based specification tests that are specially suited for frontier models are also described. Some properties of the estimators and tests are illustrated via cost functions estimated using three microdata samples of electric utility behavior.
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