Fixed cost, variable cost, markups and returns to scale

Xi Chen () and Bertrand Koebel

Working Papers of BETA from Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg

Abstract: This paper derives the structure of a production function which is necessary and sufficient for generating a fixed cost. We extend the classical production function in order to allow each input to have a fixed and a variable part. We characterize and estimates both fixed and variable components of the cost function and studies how fixed and variable costs interact and affect firms' behavior in terms of price setting and returns to scale.

Keywords: identification; imperfect competition; returns to scale; unobserved heterogeneity. (search for similar items in EconPapers)
JEL-codes: O3 (search for similar items in EconPapers)
Date: 2013
New Economics Papers: this item is included in nep-com and nep-eff
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http://beta.u-strasbg.fr/WP/2013/2013-13.pdf (application/pdf)

Related works:
Journal Article: Fixed Cost, Variable Cost, Markups and Returns to Scale (2017)
Working Paper: Fixed Cost, Variable Cost, Markups and Returns to Scale (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:ulp:sbbeta:2013-13

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