An Application of Duality under Uncertainty, Elie Appelbaum

Elie Appelbaum

Working Papers from York University, Department of Economics

Abstract: The purpose of this paper is to provide an empirical application of duality under uncertainty. Using the indirect utility function we develop a simple, empirically implementable framework, that can be used to estimate the effects of price uncertainty on firms’ behaviour. The model is used to test implications of the theory and to identify the effects of uncertainty on input demand. In an empirical example we estimate the effects of (energy and output) price uncertainty on input demand by the U.S. manufacturing industry. We find that production responses indicate the existence of risk aversion and are consistent with behaviour under decreasing absolute risk aversion. The actual effects of uncertain prices on input demand were, however, rather small.

Pages: 20 pages
Date: 1996
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://dept.econ.yorku.ca/research/workingPapers/w ... 6-uncert-duality.pdf

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:yca:wpaper:1996_8

Access Statistics for this paper

More papers in Working Papers from York University, Department of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Support ( this e-mail address is bad, please contact ).