Persistence, asymmetries and interrelation in factor demand
Marga Peeters ()
MPRA Paper from University Library of Munich, Germany
A neoclassical factor demand model for structures, equipment and labour is analyzed. It incorporates a variety of dynamic specifications, such as a multi-period time-to-build for structures, internal adjustment costs for each production factor, and external investment adjustment costs. First-order conditions of the model are estimated by the generalized method of moments using manufacturing industry data from the US, Canada, West Germany, the UK (all 1960.I-1988.IV), France (1970.I-1992.II) and the Netherlands (1971.I-1990.IV). The results endorse time-to-build for structures, persistence of technology shocks and interrelations in adjustment cost dynamics.
Keywords: factor demand; time-to-build; adjustment costs; business cycles; general method of moments; structures; equipment; gestation; irreversibility (search for similar items in EconPapers)
JEL-codes: D21 C32 C3 D92 J23 (search for similar items in EconPapers)
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