Cost and Production Duality with Time Utilization of Capital
AbstractThis article fills in some notable gaps in the literature on the existence and empirical implementation of dual cost and production models embodying the time utilization of capital. A proof of the existence of such dual cost and production functions is provided; previous results of Betancourt (1986) and Klein (1984) are extended to the general N-input-factor, continuously variable time-utilization case; and the restrictive conditions under which a conventional neoclassical empirical cost model captures the characteristics of a capital-utilization technology are derived. The general specification of cost functions that capture utilization effects is indicated.
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Bibliographic InfoPaper provided by Middle Tennessee State University, Department of Economics and Finance in its series Working Papers with number 200704.
Date of creation: Apr 2007
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Web page: http://www.mtsu.edu/~berc/working/Economics_Working_Papers.html
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duality; capital utilization; time in production.;
Find related papers by JEL classification:
- C81 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Microeconomic Data
- D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
- L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-04-28 (All new papers)
- NEP-BEC-2007-04-28 (Business Economics)
- NEP-EFF-2007-04-28 (Efficiency & Productivity)
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