Separability and capital aggregation in sectoral models of US production

Michael Hazilla

Applied Economics, 1997, vol. 29, issue 7, 955-974

Abstract: Separability plays a fundamental role in applied studies of production inasmuch as it provides for consistent aggregation and allows multi-stage estimation of models with many inputs. This paper examines whether two types of capital, structures and equipment, are weakly separable from labour and energy and materials in sectoral models of US production, and provides an assessment of the effects of maintaining capital separability. The study focuses on the elasticity of substitution as a measure of input association and associated standard errors and confidence intervals based on bootstrapping. Elasticity estimates and tests indicate that capital separability is generally inconsistent with data representing sectoral US production. Elasticity sign, however, appears robust to capital aggregation and performs especially well as an indicator of input association.

Date: 1997
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://www.tandfonline.com/doi/abs/10.1080/000368497326615 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:applec:v:29:y:1997:i:7:p:955-974

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/RAEC20

DOI: 10.1080/000368497326615

Access Statistics for this article

Applied Economics is currently edited by Anita Phillips

More articles in Applied Economics from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().