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Testing cost vs. profit function

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Listed:
  • Frank Asche
  • Subal C. Kumbhakar
  • Ragnar Tveterås

Abstract

The empirical literature on estimation of production technology mostly focuses on estimation of dual cost functions. Estimation of a profit function is not that common. Here, we formally test whether the production technology should be represented by a cost or profit function. We also derive elasticities associated with the long-run profit function from the estimated cost function.

Suggested Citation

  • Frank Asche & Subal C. Kumbhakar & Ragnar Tveterås, 2007. "Testing cost vs. profit function," Applied Economics Letters, Taylor & Francis Journals, vol. 14(10), pages 715-718.
    • Handle: RePEc:taf:apeclt:v:14:y:2007:i:10:p:715-718
    DOI: 10.1080/13504850600592655
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    References listed on IDEAS

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    Cited by:

    1. Schmid, Stefan & Kotulla, Thomas, 2011. "50 years of research on international standardization and adaptation--From a systematic literature analysis to a theoretical framework," International Business Review, Elsevier, vol. 20(5), pages 491-507, October.

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