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Panel-data Estimates of the Production Function and the Revenue Function: What Difference Does It Make?

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Author Info
Jacques Mairesse
Jordi Jaumandreu

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Abstract

The lack of individual firm information on output prices is a major problem in the econometrics of production. In particular, it may be expected to account for a significant share of the large discrepancies found between the cross-sectional and time-series estimates of capital and scale elasticities. However, taking advantage of two panel-data samples for which we had such information, we find that estimating the revenue function (using a nominal output measure) or the production function proper (using a real output measure) makes very little difference for our results. The biases due to other sources of specification errors are probably more important. Copyright The editors of the "Scandinavian Journal of Economics", 2005 .

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File URL: http://www.blackwell-synergy.com/doi/abs/10.1111/j.1467-9442.2005.00431.x
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Article provided by Blackwell Publishing in its journal The Scandinavian Journal of Economics.

Volume (Year): 107 (2005)
Issue (Month): 4 (December)
Pages: 651-672
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Handle: RePEc:bla:scandj:v:107:y:2005:i:4:p:651-672

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  3. Jaumandreu, Jordi & Mairesse, Jacques, 2006. "Using price and demand information to identify production functions," MPRA Paper 1247, University Library of Munich, Germany. [Downloadable!]
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  9. DEL GATTO, Massimo & MION, Giordano & OTTAVIANO, Gianmarco I.P., 2006. "Trade integration, firm selection and the costs of non-Europe," CORE Discussion Papers 2006061, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE). [Downloadable!]
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