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robustpf: A command for robust estimation of production functions

Author

Listed:
  • Yingyao Hu

    (Johns Hopkins University)

  • Guofang Huang

    (Purdue University)

  • Yuya Sasaki

    (Vanderbilt University)

Abstract

We introduce a new command, robustpf, to estimate parameters of Cobb–Douglas production functions. The command is robust against two poten- tial problems. First, it is robust against optimization errors in firms’ input choice, unobserved idiosyncratic cost shocks, and measurement errors in proxy variables. In particular, the command relaxes the conventional assumption of scalar unob- servables. Second, it is also robust against the functional dependence problem of static input choice, which is known today as a cause of identification failure. The main method is proposed by Hu, Huang, and Sasaki (2020, Journal of Econometrics 215: 375–398).

Suggested Citation

  • Yingyao Hu & Guofang Huang & Yuya Sasaki, 2023. "robustpf: A command for robust estimation of production functions," Stata Journal, StataCorp LP, vol. 23(1), pages 86-96, March.
    • Handle: RePEc:tsj:stataj:v:23:y:2023:i:1:p:86-96
    DOI: 10.1177/1536867X231161977
    Note: to access software from within Stata, net describe http://www.stata-journal.com/software/sj23-1/st0702/
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