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.

scholarly journals AN ECONOMIC ANALYSIS OF BARLEY PRODUCTION FUNCTIONS IN WASIT PROVINCE FOR 2014

2017 ◽  
Vol 48 (4) ◽  
Author(s):  
AL-ENIZY & AL-KAISY
Keyword(s):  
Production Function ◽  
Returns To Scale ◽  
Influential Factor ◽  
Production Functions ◽  
High Productivity ◽  
Second Stage ◽  
Use Of Resources ◽  
Economic Production ◽  
Two Factors ◽  
The Relationship

The production function of the important methods in the analysis in the components of the production process , by it can be identified the increasing in production for a given amount of resources , there for the objective of search analysis economic production functions of barley crop and knowing nature of the relationship between the factors , to fulfill the requirements of the research we are collected questionnaire from 130 farmers from crop farmers in Wasit province . We estimated by using Cobb-Douglas production function production function and restricted Cobb-Douglas. The results showed that the capital is the most influential factor in the production of barley since raised by 1% will increase production by 0.43% in a Cobb-Douglas function because the capital increase means increasing the technology used , and the factors use fall in the second stage and functions are subject to diminishing returns to scale and ealasticity replacement amounting to 0.76 indicates to the inability to intensity labour to the capital account G.Tintner test pointed to the superiority of the Cobb-Douglas unrestricted model . Also estimated the TL production function according to the random border analysis using the Frontier program , and in a way of the greatest possible ML which shows that if we increased employment by 1% , the production will increase by 0.33 and cross elasticity between labour and capital , amounting to 0.16 has shown to replacement relationship the two factors and technical effeciency at the level of the sample averaged 90% and there was no apparent effect of the acquisition . The research recommended encourage farmers to adopt improved varieties and use of resources packages with high productivity and try to stimulate the demand side of attention to livestock.

scholarly journals Production Function and Robotization - How Can CES Technology Help?

2021 ◽  
Author(s):  
Françoise Larbre
Keyword(s):  
Production Function ◽  
Returns To Scale ◽  
Production Functions ◽  
Elasticity Of Substitution ◽  
Cost Functions ◽  
Helpful Tool ◽  
Joint Product ◽  
Short Run ◽  
The Cost

Depending on the workers qualification, the use of robots is perceived either as a helpful tool or as a competitor. We analyze the substitution of capital for labor, including the case where the product is entirely made by robots. We use CES production functions and their derived cost functions (the later being surprisingly missing in the literature). We focus on short-run and the case of an elasticity of substitution greater than 1. We highlight a level of product for which the cost is identical regardless of the factor used. As a joint product, we provide a foundation to cost functions exhibiting first increasing and then decreasing returns to scale (a so far missing justification to the usually assumed shape of cost functions).

scholarly journals A NOTE ON THE CHARACTERIZATION OF THE NEOCLASSICAL PRODUCTION FUNCTION

2016 ◽  
Vol 21 (7) ◽  
pp. 1827-1835
Author(s):  
Andreas Irmen ◽  
Alfred Maußner
Keyword(s):  
Production Function ◽  
Returns To Scale ◽  
Production Functions ◽  
Alternative Characterization ◽  
Factors Of Production ◽  
Constant Returns To Scale

We study production functions with capital and labor as arguments that exhibit positive, yet diminishing marginal products and constant returns to scale. We show that such functions satisfy the Inada conditions if (i) both inputs are essential and (ii) an unbounded quantity of either input leads to unbounded output. This allows for an alternative characterization of the neoclassical production function that altogether dispenses with the Inada conditions. Although this proposition generalizes to the case of n > 2 factors of production, its converse does not hold: 2n Inada conditions do not imply that each factor is essential.

scholarly journals Le progrès, le transfert et le choix technologiques dans les pays en voie de développement (PVD) : vers une approche plus réaliste du problème de la substitution

2009 ◽  
Vol 58 (3) ◽  
pp. 303-322 ◽  
Author(s):  
Eckhard Siggel
Keyword(s):  
Production Function ◽  
Technical Progress ◽  
Technological Progress ◽  
Manufacturing Sector ◽  
Production Functions ◽  
Factor Price ◽  
Technology Choice ◽  
Technology Transfers ◽  
Engineering Information ◽  
Using Data

Abstract In this paper it is argued that the conventional estimation of production functions may be misleading for the study of technological progress and technology choice in developing countries. The analysis of technical progress and technology transfers requires empirical production functions which should reflect accurately the state of technology and productivity in a given country or region. The neoclassical production function embracing as an envelope all observations in an industry is likely to overstate the number of techniques already established in the region. It may therefore underestimate the technical progress achieved by further transfers. The problem lies in the very concept of technological progress which is defined as a shift of the universal production function and excludes movements along the production isoquant. As to the choice of technology the estimation of the elasticity of substitution may be equally misleading for the purpose of predicting changes of factor use caused by factor price changes. The substitution possibilites between factors of production in the actually existing choice set of techniques for a given country or region are better described by the concept of a technology shelf. Two important characteristics of the technology shelf are the range and density of substitution. It is argued that industrial engineering information should be used to better describe the technology shelf. In its empirical part, using data of the manufacturing sector of Zaire, the paper shows how such engineering information may be used to estimate the range and density of substitution.

scholarly journals Local and Global Dynamics in a Discrete Time Growth Model with Nonconcave Production Function

2012 ◽  
Vol 2012 ◽  
pp. 1-22 ◽  
Author(s):  
Serena Brianzoni ◽  
Cristiana Mammana ◽  
Elisabetta Michetti
Keyword(s):  
Production Function ◽  
Growth Model ◽  
Discrete Time ◽  
Production Functions ◽  
Elasticity Of Substitution ◽  
Global Dynamics ◽  
Production Factors ◽  
Local And Global Dynamics ◽  
Complex Features

We study the dynamics shown by the discrete time neoclassical one-sector growth model with differential savings while assuming a nonconcave production function. We prove that complex features exhibited are related both to the structure of the coexixting attractors and to their basins. We also show that complexity emerges if the elasticity of substitution between production factors is low enough and shareholders save more than workers, confirming the results obtained while considering concave production functions.

Educational Production Functions

1978 ◽  
Vol 3 (3) ◽  
pp. 209-231 ◽  
Author(s):  
Solomon W. Polachek ◽  
Thomas J. Kniesner ◽  
Henrick J. Harwood
Keyword(s):  
Academic Achievement ◽  
Maximum Likelihood ◽  
Production Function ◽  
Production Functions ◽  
Elasticity Of Substitution ◽  
Likelihood Methods ◽  
Educational Backgrounds ◽  
Scholastic Performance ◽  
Maximum Likelihood Methods ◽  
Educational Production

This research examines scholastic performance within the context of an individual’s production function. A constant partial elasticity of substitution production function for academic achievement is presented and estimated with non linear maximum likelihood methods. We find that ability and time devoted to various aspects of the learning process are the most important determinants of students’ accomplishments. Our results underscore the potential for students to compensate for relatively “poor” educational backgrounds by spending more time on study and class attendance.

scholarly journals Fonctions de production dans l’économie du Québec

2009 ◽  
Vol 54 (2) ◽  
pp. 176-206 ◽  
Author(s):  
Vittorio Corbo ◽  
Jean-Marie Dufour
Keyword(s):  
Strong Evidence ◽  
Economic Activity ◽  
Returns To Scale ◽  
Production Functions ◽  
Elasticity Of Substitution ◽  
True Model ◽  
Utilities Services ◽  
Capital Construction ◽  
Constant Returns To Scale ◽  
Work First

The purpose of this paper is to study the characteristics of the production process in the Quebec economy. We devote particular attention to two features of the technology: the returns to scale and the substitution possibilities. Two forms of production functions, the Cobb-Douglas and an homothetic translog production function, are estimated for six branches of economic activity. These are: Agriculture; Fishing and Forestry; Mining; Quarying and Oil Wells; Manufacturing; Utilities; Services. Two main conclusions are derived from this work. First, there is strong evidence of constant returns to scale in all branches of the Quebec economy but services. Second, when comparing the Cobb-Douglas model with an homothetic translog model, the hypothesis that the true model is the Cobb-Douglas one cannot be rejected for five of our six sectors. Therefore, there is evidence that the elasticity of substitution is around one. Finally a byproduct of our work has been the construction of capital stock series for the Quebec economy (1960-73) disaggregated into 14 sectors, and two types of capital: construction and machinery and equipment.

CONSTANT-ELASTICITY-OF-SUBSTITUTION PRODUCTION FUNCTION

2008 ◽  
Vol 12 (5) ◽  
pp. 694-701 ◽  
Author(s):  
Hideki Nakamura ◽  
Masakatsu Nakamura
Keyword(s):  
Production Function ◽  
Capital Accumulation ◽  
Specific Form ◽  
Production Functions ◽  
Elasticity Of Substitution ◽  
Intermediate Goods ◽  
Constant Elasticity ◽  
Constant Elasticity Of Substitution ◽  
Douglas Production Function

We consider endogenous changes of inputs from labor to capital in the production of intermediate goods, i.e., a form of mechanization. We derive complementary relationships between capital accumulation and mechanization by assuming a Cobb–Douglas production function for the production of final goods from intermediate goods. A constant-elasticity-of-substitution production function in which the elasticity of substitution exceeds unity can be endogenously derived as the envelope of Cobb–Douglas production functions when the efficiency of inputs is assumed in a specific form. The difficulty of mechanization represents the elasticity of substitution.

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