It is by now incontrovertible that increases in per capita income cannot be explained simply by increases in the capital-labor ratio. Though doubtless no economist would ever have denied the role of technological change in economic growth, its overwhelming importance relative to capital formation has perhaps only been fully realized with the important empirical studies of Abramovitz [1] and Solow [l 1]. These results do not directly contradict the neo-classical view of the production function as an expression of technological knowledge. All that has to be added is the obvious fact that knowledge is growing in time. Nevertheless a view of economic growth that depends so heavily on an exogenous variable, let alone one so difficult to measure as the quantity of knowledge, is hardly intellectually satisfactory. From a quantitative, empirical point of view, we are left with time as an explanatory variable. Now trend projections, however necessary they may be in practice, are basically a confession of ignorance, and, what is worse from a practical viewpoint, are not policy variables.

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The Economic Implications of Learning by Doing

Exact and superlative index numbers

The paper indicates how the Shephard duality theorem may be utilized in order to obtain a system of derived demand equations which are linear in the technological parameters, thus facilitating econometric estimation. This theorem states that technology may be equivalently represented by either a production function or a cost function, and a proof of the theorem is given. The chosen functional form is a quadratic form in the square roots of input prices and is a generalization of the Leontief cost function. The generalization has the property that it can attain any set of partial elasticities of substitution using a minimal number of parameters.

An Application of the Shephard Duality Theorem: A Generalized Leontief Production Function

Current issues are now on the Chicago Journals website. Read the latest issue.One of the oldest and most prestigious journals in economics, the Journal of Political Economy (JPE) presents significant and essential scholarship in economic theory and practice. The journal publishes highly selective and widely cited analytical, interpretive, and empirical studies in a number of areas, including monetary theory, fiscal policy, labor economics, development, microeconomic and macroeconomic theory, international trade and finance, industrial organization, and social economics.

Real Wages, Employment, and Inflation

В статье рассматривается класс производственных функций с постоянной эластичностью замены безотносительно цен факторов, рассматривается случай, когда в процесс вовлекается больше чем два фактора.

Production Functions with Constant Elasticities of Substitution

Обсуждаются следующие темы: чистая теория производства, функциональное распределение дохода, технический прогресс, источники международных конкурентных преимуществ. Анализируются эластичность замещения между трудом и капиталом в обрабатывающей промышленности; производственные функции различного типа.

Bagicha S. Minhas

Papers

Capital-labor substitution and economic efficiency