Journal of Political Economy Vol. 79 No. 3 1971
An Application of the Shephard Duality Theorem: A Generalized Leontief Production Function
Abstract
The paper indicates how the Shephard duality theorem may be utilized in order to obtain a system of derived demand equations which are linear in the technological parameters, thus facilitating econometric estimation. This theorem states that technology may be equivalently represented by either a production function or a cost function, and a proof of the theorem is given. The chosen functional form is a quadratic form in the square roots of input prices and is a generalization of the Leontief cost function. The generalization has the property that it can attain any set of partial elasticities of substitution using a minimal number of parameters.
- DOI
- 10.1086/259764
- Volume
- 79
- Issue
- 3
- Pages
- 481-507
- Language
- en
- Sources
- openalex crossref