Mukerji-production functions in the input-output model

R.G. Kreijger

No 293043, University of Amsterdam, Actuarial Science and Econometrics Archive from University of Amsterdam, Faculty of Economics and Business

Abstract: In this paper the well-known assumption of constant technical coefficients in input-output analysis is relaxed. For each sector it is assumed that production takes place according to a Mukerji production function: x. = (Ia. 1J) 1 . where x, is the production J 1J 1J J volumeofsectorjandthex.are the production factors (among which ij are intermediate deliveries from other sectors). Profit maximization in each sector then leads to equations which express the x.. ,as :511E1c-tic= of the :x. and of prices. An adjustment mechanism lj J and time trend are added. The resulting specifications are estimated for 17 sectors using Dutch data for the period 1953-1968. The results are reported in the paper. The fit of this model is then compared with the fit of the constant-coefficients model. "Constant" here means: independent of prices and level of production, but allowing for time trends and autocorrelation. The Mukerji specification turns out to have a significantly better fit.

Keywords: Productivity Analysis; Research Methods/Statistical Methods (search for similar items in EconPapers)
Pages: 38
Date: 1977
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Persistent link: https://EconPapers.repec.org/RePEc:ags:amstas:293043

DOI: 10.22004/ag.econ.293043

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