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The Role Of Curvature In Estimating Accurate Dual Functions

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Author Info
Tauer, Loren

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Abstract

A production function highly concave in inputs will have a dual profit function less convex in prices. Even large variations in prices will cause little variation in input usage and output, resulting in poor profit function estimates. This is demonstrated using Monte Carlo simulation with various curvatures and error structures.

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Publisher Info
Paper provided by Cornell University, Department of Applied Economics and Management in its series Working Papers with number 14752.

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Date of creation: 2001
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Handle: RePEc:ags:cudawp:14752

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Keywords: Research Methods/ Statistical Methods;

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This page was last updated on 2009-12-11.

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