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Production Function and Robotization - How Can CES Technology Help?

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  • Larbre, Françoise

    (Université Paris Nanterre)

Abstract

Depending on the workers qualification, the use of robots is perceived either as a helpful tool or as a competitor. We analyze the substitution of capital for labor, including the case where the product is entirely made by robots. We use CES production functions and their derived cost functions (the later being surprisingly missing in the literature). We focus on short-run and the case of an elasticity of substitution greater than 1. We highlight a level of product for which the cost is identical regardless of the factor used. As a joint product, we provide a foundation to cost functions exhibiting first increasing and then decreasing returns to scale (a so far missing justification to the usually assumed shape of cost functions).

Suggested Citation

  • Larbre, Françoise, 2021. "Production Function and Robotization - How Can CES Technology Help?," SocArXiv b46uz, Center for Open Science.
    • Handle: RePEc:osf:socarx:b46uz
    DOI: 10.31219/osf.io/b46uz
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    References listed on IDEAS

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    1. Robert M. Solow, 1956. "A Contribution to the Theory of Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 70(1), pages 65-94.
    2. Rainer Klump & Harald Preissler, 2000. "CES Production Functions and Economic Growth," Scandinavian Journal of Economics, Wiley Blackwell, vol. 102(1), pages 41-56, March.
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