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  • Interpretation of inefficiency determinants in logarithms, SFA

    I am implementing a 'true fixed effect' model (Greene, 2005) using the 'sfpanel' Stata command. I'm mostly interested in analyzing the determinants of technical inefficiency (the zit variables), so I assume that uit is a non-negative truncation (at zero) of the normal distribution with mean zitδ and variance σ2. Now then, most studies introduce the zit variables in their original units of measurement. Nonetheless, I wonder how the interpretation would change if I introduce them in logarithms [as ln(zit)]. Could they be interpreted as 'elasticities'?
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