Efficiency Analysis of Knowledge Firms as Knowledge Producers Using Stochastic Frontier Model

The main purpose of this paper is to analize the technical efficiency of knowledge firms as a knowledge producer. First, the knowledge production process is modeled using a stochastic frontier of knowledge production. Then, the model is tested using knowledge firm data in Iran. The empirical results indicate that production process in knowledge firm includs two main stages: research and knowledge conversion. In research stage, the knowledge firm uses knowledge worker, knowledge capital and scientific equipments to produce new explicit knowledge. In conversion stage, it uses new explicit knowledge and tacit knowledge to produce knowledge products. In these stages, firm characteristics such as size, ownership, research collaboration with other organizations have influence an efficiency of knowledge firms.