[Limdep Nlogit List] Stochastic Frontier Analysis

[Kathleen Carey]

SFA users:
 
I am estimating a hospital cost function in LIMDEP 8.0 using stochastic
frontier analysis (half-normal distribution assumption for inefficiency
component of the error).  I expect that the inefficiency scores will be
unique for each observation, but I am generating some peculiar results.  Of
1032 observations, there are 29 observations that have the same efficiency
score, 1.9943.  These are the highest values in the distribution.
 
My code is as follows:
 
frontier; lhs=lncost;
rhs=one,lndis,lnopv,lnlos,scope1,aprdrg,beds,opvcmi,resrat,hhi,sysid,k1,k2,w
age,psi07,psi15

; Cost

; eff=u $

create ; expu=exp(u)$

sort ; lhs=expu$

list ; expu$

 
The dependent variable is the log of total hospital costs, and the
independent variables include multiple outputs (also expressed in logs) and
several covariates.  Variations on the model and small adjustments in the
included observations produce a similar result, with a large number of the
exact same efficiency score, expu, (to 8 places after the decimal).  These
values are always at the top end of the tail, which otherwise appears to be
properly distributed.
 
Has anyone had this experience before, or have a suggestion for what might
be going on here?
 
Thanks in advance,
 
Kathleen Carey
Boston University School of Public Health