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  • how to take derivative of translog cost function obtained from stochastic frontier analysis


    Hi there, first and foremost thank you for any reply and taking time to read this post. This is my first post so sorry if i have not met the formal requirements, i will get used to it.
    I am currently trying to estimate marginal cost for bank Lerner Index. where Lerner = price - marginal cost/ price . the data i have used is as bank level.

    I have found the translog cost function using stochastic frontier analysis. the obtained results, and equations are attached as a word file. The problem i am having is on how to taking the derivative of the tranlog function computed in sfpanel. any help on how to estimate margincal cost at individual bank level would be helpful. or the stata command to run the regression . any feed back on the translog cost function results would also be greatful.
    Attached Files

  • #2
    did you find your solution? im struggling with the same

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    • #3
      Write down the cost function, take the derivative and then use lincom to compute the estimate and standard errors.

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