Holoreturns And Holothetic Invariance in Economics

Adil Ahmad Mughal

MPRA Paper from University Library of Munich, Germany

Abstract: Hicks neutral technical progress implies that in Y = AF(K, L) any technical progress only changes the technological knowledge, A, but does not af ect inputs and this is the Hicks-neutral holothetic result given by Sato in which the technical progress transforms into a scale ef ect without changing the map of isoquants to non-holothetic trajectory. This holothetic nature of production functions is possible under Lie-group like transformations with invariance properties for production functions under a given technical progress. This paper proposes a Farkas Lemma-like character of this holothetic transformation. Kostant's Convexity Theorem is a well-generalized result of convexity on Lie-group transformations concerning holotheticity. There's an 'equilibrium pricing' way found here for a convexity assumption implying 'holothetic invariance'.

Keywords: Holotheticity; Homothetic technology; Economic Invariance; Lie groups; Transformation groups; Farkas' Lemma; Holoreturns; Idiosyncratic risk; Kostant Convexity (search for similar items in EconPapers)
JEL-codes: C0 C1 C18 D4 D46 D8 G0 G01 (search for similar items in EconPapers)
Date: 2022-09
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