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Estimating Indirect Production Functions with a More General Specification: An Application of the Lewbel Model

Published online by Cambridge University Press:  28 April 2015

Christiana E. Hilmer  and
Matthew T. Holt
Christiana E. Hilmer
Affiliation:
Department of Economics, San Diego State University, San Diego, CA
Matthew T. Holt
Affiliation:
Department of Agricultural and Resource Economics, North Carolina State University, Raleigh, NC
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Abstract

Whereas consumer theory employs several different empirical specifications for estimating indirect utility functions, producer theory has relied on the Translog specification to estimate the indirect production function. In this paper, we apply Lewbel's more general functional specification and investigate its implications for the estimation of indirect production functions in productivity analysis. An attractive feature of the Lewbel model is that it nests both the Translog and the almost ideal supply system, offering a method to assess the empirical validity of all three specifications. Aggregate U.S. production data are used to examine the performance of the three models in an empirical application.

Keywords

dualityindirect production functionnested testC32C52Q12
Type
Articles
Information
Journal of Agricultural and Applied Economics , Volume 37 , Issue 3 , December 2005 , pp. 619 - 634
Copyright
Copyright © Southern Agricultural Economics Association 2005

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