Technical, allocative and economic efficiency measures are deri ved Jor a sample oj 73 Joodrnprocessing firms in Ethiopia. A switching regression model was used to examine potentialrnselectivity bias for private and public owned firms. A three separated Stochastic ProductionrnFrontier (SPFs) and Cost Junctions corrected Jor selectivity bias were estimated for eachrngroup. The stochastic [rontier Cobb Douglas production and cost Junction model was used tornmeasure the firm-level efficiency differential between private and public owned foodrnprocessing firms alld to predict the firm level technical, economic and allocative efficiencies.rnThe predicted technical efficiency and economic efficiency are the basis for estimatingrna/locative efficiency oJprivate and publiciirms under the study.rnThe result olthe allalysis indicate that presence oj technical inefficiencv alld cost in ~/ficiellcyrnefFects in food processing .firms in general and in the 1)I{biic ./iJOd IJroeessillg finlls inrnparticular, lvhich realized by the sigllifical1l estillJated gamllla cae{/Ieiellt.' alld thl'rngeneralized likelihood ratio tes/. The main results indicate that firms 'with private ownershiprnshow statistically higher average IE than those with public ownership. The estimated meanrntechnical and economic efficiencies obtained f rom SPFs and cost Junction were higher forrnprivate food processing finns than their counterparts. Mareover the results indicate that meanrntechnical efficiency levels affirms in the sector difFer profoundly .fiom the 56 percent 28rnpercent respectively for private and public firl1l s. This proves the fact that there is a wide 1'00111rnfor improvement. More precisely, on the average, output can be expallded by as much as 44rnand 72 percent il appropriate measures are taken to illJProve the technical ~/Jiciency. Thernimpact of privatization on TE was analyzed and found positive and have significallt eJfect 011rnefficiency. Based on the resuits of the study, in order to promote eificient utilization of inputrnresources, the government should speed up the privatization process and transfer the publicrnfirms in to private hands.