IDEAS home Printed from https://ideas.repec.org/a/bes/jnlbes/v12y1994i2p261-65.html
   My bibliography  Save this article

Imposing Linear Homogeneity on Box-Tidwell Flexible Functional Forms

Author

Listed:
  • Shin, Richard T
  • Ying, John S

Abstract

The authors consider two forms of the Box-Tidwell cost function, which uses the increasingly popular Box-Cox metric. If the dependent variable is the logarithm of cost, the function violates the regularity condition of homogeneity in factor prices, globally and locally. If cost is transformed by the Box-Cox metric, global homogeneity requires highly restrictive parameter constraints such that the model is no longer flexible, while local homogeneity is satisfied at only the base point of approximation. The authors demonstrate that normalizing the first model by the deleted factor price alters the model so that estimates are no longer invariant.

Suggested Citation

  • Shin, Richard T & Ying, John S, 1994. "Imposing Linear Homogeneity on Box-Tidwell Flexible Functional Forms," Journal of Business & Economic Statistics, American Statistical Association, vol. 12(2), pages 261-265, April.
  • Handle: RePEc:bes:jnlbes:v:12:y:1994:i:2:p:261-65
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sherrill Shaffer, 1998. "Functional Forms and Declining Average Costs," Journal of Financial Services Research, Springer;Western Finance Association, vol. 14(2), pages 91-115, October.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bes:jnlbes:v:12:y:1994:i:2:p:261-65. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Christopher F. Baum (email available below). General contact details of provider: http://www.amstat.org/publications/jbes/index.cfm?fuseaction=main .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.