Production Factor Returns: The Role of Factor Utilization

Gilbert Cette, Nicolas Dromel, Rémy Lecat and Anne-Charlotte Paret
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Anne-Charlotte Paret: Centre de recherche de la Banque de France - Banque de France, GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique

PSE-Ecole d'économie de Paris (Postprint) from HAL

Abstract: Short-term increasing returns to production factors are usually found in empirical studies. We argue they can be due to omitted variables, particularly the intensity of factor utilization. Thanks to original French firm-level data (1992–2008), we show how increasing returns to scale disappear when working time, capacity utilization rate, and, particularly, capital operating time are introduced in the production function.

Keywords: Production function; productivity; factor returns (search for similar items in EconPapers)
Date: 2015-03
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Citations: View citations in EconPapers (5)

Published in Review of Economics and Statistics, 2015, 97 (1), pp.134-143. ⟨10.1162/REST_a_00434⟩

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Related works:
Journal Article: Production Factor Returns: The Role of Factor Utilization (2015)
Working Paper: Production Factor Returns: The Role of Factor Utilization (2015)
Working Paper: Production Factor Returns: The Role of Factor Utilization (2015)
Working Paper: Production factor returns: the role of factor utilisation (2011)
Working Paper: Production factor returns: the role of factor utilisation (2011)
Working Paper: Production factor returns: the role of factor utilisation (2011)
Working Paper: Production factor returns: the role of factor utilisation (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:pseptp:hal-01507167

DOI: 10.1162/REST_a_00434

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