Elasticity of substitution, technical progress and returns to scale in branches of Soviet industry: A new CES production function approach

1991 ◽  
Vol 6 (1) ◽  
pp. 91-96 ◽  
Author(s):  
Erkin Bairam
Keyword(s):  
Production Function ◽  
Technical Progress ◽  
Returns To Scale ◽  
Function Approach ◽  
Elasticity Of Substitution ◽  
Production Function Approach

scholarly journals The Two-level CES Production Function for the Manufacturing Sector of Pakistan

1989 ◽  
Vol 28 (1) ◽  
pp. 1-12 ◽  
Author(s):  
Ashfaque H. Khan
Keyword(s):  
Production Function ◽  
Technical Progress ◽  
Manufacturing Sector ◽  
Relevant Literature ◽  
Returns To Scale ◽  
Appropriate Technology ◽  
Production Functions ◽  
Elasticity Of Substitution ◽  
Two Factors ◽  
Factors Of Production

Production functions have been widely studied in the relevant literature. In this paper, apart from labour and capital, we have used energy as a factor input and calculated the elasticity of substitution between these inputs, measured technical progress, and determined the returns to scale in the manufacturing sector of Pakistan. Since we have more than two factors of production, the standard Cobb· Douglas and CES production functions do not provide satisfactory results. Hence, two·level (nested) CES production function becomes the natural choice for the appropriate technology. Using this technology, we have found low elasticity of substitution between the three factors of production. Furthermore, the manufacturing sector is found to exhibit decreasing returns to scale, having experienced disembodied technical progress at the rate of 3.7 percent per annum.

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