A Brief History of Production Functions

Mishra, SK

doi:10.2139/ssrn.1020577

Cited by 59 publications

(48 citation statements)

References 83 publications

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Section: Aggregate Production Functions (Apfs)mentioning

confidence: 99%

“…The origins of APFs can be traced to von Thünen in the 1840s [17,18], and the meaningfulness of models built using APFs has been debated nearly as long. Mishra [18] provides an excellent history of production functions and a detailed discussion of the key controversies surrounding their use. Brockway et al [19] is a "sister" paper to this and provides a general, non-empirical discussion of the landscape around CES APFs, summarizing several notable critics and their arguments [5,6,[20][21][22] and providing guidance for the application of the CES APF to economic growth modeling.…”

Section: Aggregate Production Functions (Apfs)mentioning

confidence: 99%

“…Table 2. Constant Elasticity of Substitution (CES) boundary models (rows [1][2][3][4][5][6][7][8][9][10][11][12][13][14][15][16][17][18][19][20] and the generic three-factor CES equation (bottom row). Factors of production (x 1 , x 2 , x 3 ) are permutations of capital, labor, and energy (k, l, e).…”

Section: Techniquementioning

confidence: 99%

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From Theory to Econometrics to Energy Policy: Cautionary Tales for Policymaking Using Aggregate Production Functions

et al. 2017

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Development of energy policy is often informed by economic considerations via aggregate production functions (APFs). We identify a theory-to-policy process involving APFs comprised of six steps: (1) selecting a theoretical energy-economy framework; (2) formulating modeling approaches; (3) econometrically fitting an APF to historical economic and energy data; (4) comparing and evaluating modeling approaches; (5) interpreting the economy; and (6) formulating energy and economic policy. We find that choices made in Steps 1-4 can lead to very different interpretations of the economy (Step 5) and policies (Step 6). To investigate these effects, we use empirical data (Portugal and UK) and the Constant Elasticity of Substitution (CES) APF to evaluate four modeling choices: (a) rejecting (or not) the cost-share principle; (b) including (or not) energy; (c) quality-adjusting (or not) factors of production; and (d) CES nesting structure. Thereafter, we discuss two revealing examples for which different upstream modeling choices lead to very different policies. In the first example, the (kl)e nesting structure implies significant investment in energy, while other nesting structures suggest otherwise. In the second example, unadjusted factors of production suggest balanced investment in labor and energy, while quality-adjusting suggests significant investment in labor over energy. Divergent outcomes provide cautionary tales for policymakers: greater understanding of upstream modeling choices and their downstream implications is needed.

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Section: Aggregate Production Functions (Apfs)mentioning

confidence: 99%

Section: Aggregate Production Functions (Apfs)mentioning

confidence: 99%

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From Theory to Econometrics to Energy Policy: Cautionary Tales for Policymaking Using Aggregate Production Functions

et al. 2017

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“…Quando se trata dos modelos analíticos empregados para representar as atividades produtivas, a maioria das abordagens envolve apenas a produção de um único produto homogêneo (para uma visão mais abrangente, ver Mishra, 2007). De acordo com Larsson (2003, p. 3), apesar de que o uso de um único insumo é suficiente quando a função de produção é separável, a hipótese de separabilidade é forte o bastante para acarretar conclusões empiricamente equivocadas.…”

Section: Fundamentos Analíticosunclassified

Um modelo estilizado da produção de serviços: aplicação empírica a uma amostra de bibliotecas no Rio de Janeiro 2000 – 2007

Carvalho

Jorge

Jorge³

et al. 2013

Encontros Bibli

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RESUMOEmbora reduzidas em número, as aplicações de modelos originados na área de Operações ao caso de bibliotecas estão registradas na literatura. Este trabalho adota uma visão estilizada em que a produção de serviços é representada como simples transformação de insumos em produtos, sem atentar para a especificidade dos processos produtivos envolvidos. O principal objetivo do trabalho é examinar empiricamente como essa transformação ocorre, focalizando como se comportam os elos entre insumos e produtos ao longo do período de análise. O exame empírico se apóia em dados secundários, coletados de uma amostra representando mais de 80% do universo das bibliotecas de uma IFES no Rio de Janeiro entre 2000 e 2007. Com auxílio da técnica multivariada da Correlação Canônica foi possível identificar associações significativas entre grupos de insumos e de produtos. Os resultados mostram que esses grupos se interligam a um nível de significância inferior a 5% e que a medida chamada de redundância cruzada quase sempre excedeu 50%, podendo ser considerada uma boa indicação de poder explicativo, uma vez que os dados se referem a cross sections anuais. Dentre os elos insumo-produto identificados como significativos, o efeito quantitativamente dominante reflete a combinação dos três insumos -a saber, pessoal, acervo e espaço -enquanto que a área ocupada aparece de novo, isoladamente, como segunda dimensão significativa.

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“…Several types of production functions have been proposed in the past based on either empirical or theoretical considerations (for general surveys, see e.g., [1] [2]). For example, the Cobb-Douglas production function ( [3]) is widely used as a simple model to study economic growth in spite of some of its limitations (that we shall discuss later).…”

Section: Introductionmentioning

confidence: 99%

A Growth Framework Using the Constant Elasticity of Substitution Model

Bhattacharya¹

2017

JAMP

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Some results in growth theory based on the Cobb-Douglas production function model are generalized when the production function is chosen to be the Constant Elasticity of Substitution (CES) function. Such a generalization is of considerable interest because it is known that the Cobb-Douglas function cannot be used as a suitable model for some production technologies (like the US economy and climate changes). It is shown that in the steady state the growth rate of the output is equal to the Solow residual and that the capital deepening term becomes zero. The CES function is a homogeneous function of degree two and a result is obtained on the wage of a worker using the Euler's theorem.

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A Brief History of Production Functions

Cited by 59 publications

References 83 publications

From Theory to Econometrics to Energy Policy: Cautionary Tales for Policymaking Using Aggregate Production Functions

From Theory to Econometrics to Energy Policy: Cautionary Tales for Policymaking Using Aggregate Production Functions

Um modelo estilizado da produção de serviços: aplicação empírica a uma amostra de bibliotecas no Rio de Janeiro 2000 – 2007

A Growth Framework Using the Constant Elasticity of Substitution Model

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