Price deflators and the estimation of the production function
The use of industry indices to deflate nominal revenues and expenditure in intermediary inputs has been found to lead to lower scale estimates of the production function. This paper proposes a new approach to solve the estimation biases due to the use of industry deflators which relies on the use of the firms' labour cost.
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- Tor Jakob Klette & Zvi Griliches, 1994.
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- Jacques Mairesse & Jordi Jaumandreu, 2005. "Panel-data Estimates of the Production Function and the Revenue Function: What Difference Does It Make?," Scandinavian Journal of Economics, Wiley Blackwell, vol. 107(4), pages 651-672, December.
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15/1998, Oslo University, Department of Economics.
- Klette, Tor Jakob, 1999. "Market Power, Scale Economies and Productivity: Estimates from a Panel of Establishment Data," Journal of Industrial Economics, Wiley Blackwell, vol. 47(4), pages 451-76, December.
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