IDEAS home Printed from https://ideas.repec.org/a/pkp/teafle/v9y2022i2p257-272id3180.html
   My bibliography  Save this article

Output and Substitution Elasticities in Pakistan’s Industrial Sectors: Panel Data Analysis

Author

Listed:
  • Sidra Nazir
  • Nasir Mahmood
  • Gulnaz Hameed

Abstract

This study performed a panel data analysis of Pakistan’s nine major sub-industries in the years 1980–2019. The primary objective was to conduct a disaggregate analysis of the substitution elasticity of inputs in the different industries, including textile, mining and currying, manufacturing, fuel extraction, electricity, gas, and water supply, using the translog production function. The study used the translog production function to estimate output and substitution elasticities for each sub-industry. Based on the results of the output elasticities, the study concluded that there were negative elasticities for the inputs oil, gas, and labor, except for capital, which had positive elasticity, causing increasing returns to scale for industries. The elasticity of substitution was greater than one and the value was positive, showing that costly energy inputs can and should be replaced with cheaper energy inputs in these industries. For instance, electricity can be replaced with gas, which is cheaper than electricity in Pakistan.

Suggested Citation

  • Sidra Nazir & Nasir Mahmood & Gulnaz Hameed, 2022. "Output and Substitution Elasticities in Pakistan’s Industrial Sectors: Panel Data Analysis," The Economics and Finance Letters, Conscientia Beam, vol. 9(2), pages 257-272.
    • Handle: RePEc:pkp:teafle:v:9:y:2022:i:2:p:257-272:id:3180
    as

    Download full text from publisher

    File URL: https://archive.conscientiabeam.com/index.php/29/article/view/3180/7025
    Download Restriction: no
    File URL: https://archive.conscientiabeam.com/index.php/29/article/view/3180/7037
    Download Restriction: no
    ---><---

    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:pkp:teafle:v:9:y:2022:i:2:p:257-272:id:3180. 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: Dim Michael (email available below). General contact details of provider: https://archive.conscientiabeam.com/index.php/29/ .

    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.