Functional Separability and the Existence of Consistent Aggregates in U.S. Manufacturing: Comment

Kirupakaran C Ramaiah and Ardeshir J Dalal

International Economic Review, 1996, vol. 37, issue 1, 253-58

Abstract: This paper examines the relationship between separability of the direct production function in inputs and separability of the indirect production function in input prices. In particular, it shows that simultaneous direct and indirect weak separability implies homotheticity of the direct production function, and hence homotheticity of the indirect production function. Thus, inferences regarding direct separability based on empirical tests for indirect separability would be valid only if homotheticity is also imposed and treated as maintained hypothesis. Copyright 1996 by Economics Department of the University of Pennsylvania and the Osaka University Institute of Social and Economic Research Association.

Date: 1996
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