Beyond Cobb-Douglas: Estimation of a CES Production Function with Factor Augmenting Technology
نویسندگان
چکیده
منابع مشابه
An Assessment of CES and Cobb-Douglas Production Functions
This paper surveys the empirical and theoretical literature on macroeconomic production functions and assesses whether the constant elasticity of substitution (CES) or the CobbDouglas specification is more appropriate for use in the CBO’s macroeconomic forecasts. The Cobb-Douglas’s major strengths are its ease of use and its seemingly good empirical fit across many data sets. Unfortunately, the...
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As Solow once remarked to me, we would not now be concerned with the question [the existence of the aggregate production function] had Paul Douglas found labor's share of American output to be twenty-five per cent and capital's share seventy-five instead of the other way around [Fisher, 1969, 572]. I hope that someone skilled in econometrics and labor will audit and evaluate my critical finding...
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In this paper a re-examination of the original time-series data sets used by Professor Douglas and associated researchers to establish the existence of an aggregate production function is undertaken. Particular attention is paid to the issue of whether the data provide deductive support for the ‘Laws of Production’ as claimed by Douglas (1948). Various statistical methods are used to analyse th...
متن کاملFitting of Cobb-Douglas Production Functions: Revisited
The set of Cobb-Douglas production functions is usually fitted by first linearizing the models through logarithmic transformation and then applying method of least squares. However, this procedure is valid only when the underlying assumption of multiplicative error-terms is justified. Unfortunately, this assumption is rarely satisfied in practice and accordingly, the results obtained are of dou...
متن کاملOptimal Consumption in a Stochastic Ramsey Model with Cobb-Douglas Production Function
A stochastic Ramsey model is studied with the Cobb-Douglas production function maximizing the expected discounted utility of consumption. We transformed the Hamilton-Jacobi-Bellman (HJB) equation associated with the stochastic Ramsey model so as to transform the dimension of the state space by changing the variables. By the viscosity solution method, we established the existence of viscosity so...
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ژورنال
عنوان ژورنال: SSRN Electronic Journal
سال: 2011
ISSN: 1556-5068
DOI: 10.2139/ssrn.1762590