Long-Run Profit Functions for Multiproduct Firms

Dale Squires

American Journal of Agricultural Economics, 1987, vol. 69, issue 3, 558-569

Abstract: A long-run specification of the multiproduct profit function is developed from the restricted profit function. The multiproduct restricted profit function and the envelope condition are used to estimate the optimal, long-run levels of the quasi-fixed factor. Formulas for long-run Marshallian elasticities of substitution and transformation, economies of scope, product-specific and overall economies of scale, and economic measures of capacity utilization are developed for the translog functional form. The methodology is illustrated by a case study of the New England otter trawl industry.

Date: 1987
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Persistent link: https://EconPapers.repec.org/RePEc:oup:ajagec:v:69:y:1987:i:3:p:558-569.

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