The paper demonstrates the invalidity of Levhari’s attempts to show that it is impossible for a production system that has ceased to be profitable due to a change in the rate of profits, to become profitable again when the profit rate changes further in the same direction. We first point out where Levhari’s argument fails and then show, by means of a numerical example, that such a ‘return’, or ‘switch-back’, of a production system is possible under Levhari’s own assumptions. We will then comment on the origin and implications of the error that the ‘return’ of a system reveals in traditional theory.

John P. Shelton, Stockholder Distribution Decisions: Share Repurchases on Dividends?: Discussion, The Journal of Financial and Quantitative Analysis, Vol. 1, No. 1, Proceedings of the First Annual Meeting of the Western Finance Association (Mar., 1966), pp. 26-28a

Journal Article Marginal Productivity and the MacroEconomic Theories of Distribution: Reply to Pasinetti and Robinson Get access P. Samuelson, P. Samuelson Massachusetts Institute of Technology Search for other works by this author on: Oxford Academic Google Scholar F. Modigliani F. Modigliani Massachusetts Institute of Technology Search for other works by this author on: Oxford Academic Google Scholar The Review of Economic Studies, Volume 33, Issue 4, October 1966, Pages 321–330, https://doi.org/10.2307/2974429 Published: 01 October 1966

The sampling properties of the usual estimator of marginal product from a CobbDouglas production function are studied under the assumption of normally distributed errors. The asymptotic normality of these estimators is demonstrated and certain special cases are considered for which the asymptotic distribution is particularly simple. An alternative estimator of marginal product is suggested which has both a smaller bias and greater precision than the usual estimator. Estimators of the variance-covariance matrix of all marginal product estimators mentioned are given. These are accurate to order n-1. A GREAT deal of attention is given nowadays to the statistical properties of estimators of parameters in simultaneous equations models. By contrast, little attention is given to the statistical properties of estimators of parameters in simpler economic models. One such model that has been virtually ignored by statisticians is the Cobb-Douglas production function. The usefulness of this function in the cross section analysis of an industry should not be underrated although, as with all models, care must be taken to ensure that the data to which the function is fitted correspond reasonably well with the assumptions, both economic and statistical, implied by the function. The purpose of the present paper is to consider some of the statistical properties of estimators of marginal product obtained from a CobbDouglas function. Section 2 will discuss the estimator most frequently used (see, for example, Tintner and Brownlee [8] and Heady [4]). The third section will discuss alternative estimators which reduce bias to order n-2 where n is the size of sample. These alternative estimators may be useful when the sample size is small and the variability of observed production about the fitted Cobb-Douglas function is large. The fourth section considers the problem of estimating the variance matrices of the estimators discussed in Sections 2 and 3. A numerical illustration is given in Section 5.

ONE of the most comrmronly used methods of depreciating capital goods is to write off their initial value in equal annual portions in the course of the estimated lifetime. When this lifetime is correctly estimated and when the depreciation fund is left idle its value (apart from price changes which will be left entirely out of account here) at the end of the lifetime will evidently be equal to the initial value of the capital good and will allow for the replacement of the worn-out item by an exactly identical new one. In reality, this equality will very seldom be fulfilled. This is not only due to the fact that the individual lifetimes of identical capital goods will vary so that, at best, only a correct average can be used which could yield equality for very large values of the initial stock only, but still more because depreciation funds are usually reinvested in one way or another long before replacement has become necessary. In particular, in dynamic processes replacement and depreciation may differ considerably. Already in 1953 E. Doomar [2] has proved that in an exponentially growing economy, when depreciation funds are immediately reinvested, the method of constant depreciation over time will lead to an amount of depreciation D, at time t bearing a constant ratio to the amount to be replaced R,, given by: Dt: Rt = (eyT -1) :yT1 ) where y is the rate of growth of the economy and T the average lifetime of the capital goods. For reasonable values of y and T the ratio may differ greatly from one. Dr. Horvat [3] studies the consequences of the method for a different kind of dynamic process. He considers a large stock of identical new capital goods Ko at t= 0. All items are assumed to have exactly the same lifetime, T. Hence, according to the method of

Journal Article On Factor Accumulation and the Pattern of International Specialisation Get access P. K. Bardhan P. K. Bardhan Pembroke College, Cambridge Search for other works by this author on: Oxford Academic Google Scholar The Review of Economic Studies, Volume 33, Issue 1, January 1966, Pages 39–44, https://doi.org/10.2307/2296639 Published: 01 January 1966

In the paper, exact tests are proposed for testing the trend in the presence of autocorrelation and also for testing the trend and autocorrelation simultaneously in a first order Markov process. Also, the simultaneous confidence intervals associated with these tests are derived. These results are extended to a higher order Markov process.

The article explores the presence of accounting in the Zenon papyri of the Greeks. The manuscripts give evidence of a surprisingly elaborate accounting system which had been used in Greece since the fifth century B.C. All accounts were audited, as evidenced by a sloping downstroke or a heavy dot in front of each figure. The Zenon papyri include several monthly, annual, and even triennial summaries of accounting transactions. Their most remarkable feature is the high degree of accounting control and the business-like efficiency of central management.

Electronic data processing has brought about vast changes in every area of business management, and the credit and accounts receivable department is certainly no exception. Moreover, changes in business in general have placed greater emphasis on credit management. With computerization, the credit manager is in a better position to make a worthwhile contribution in the solution of problems facing management. The National Association of Credit Management reports that the dollar quantity of receivables is on the rise. New and more sophisticated quantitative techniques have been developed to assist credit management in assuming a new role in the total management of the firm. On one hand, management is concerned about the possible loss of sales due to a credit policy which is too tight; on the other hand, the concern is with possibly high bad-debt losses caused by an easy credit policy. The article discusses a credit model that can assist management in resolving this conflict. The model adopts marginal costing methodology, which offers accurate information for the management.