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The Cobb-Douglas production function revisited

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  • Roman G. Smirnov
  • Kunpeng Wang

Abstract

Charles Cobb and Paul Douglas in 1928 used data from the US manufacturing sector for 1899-1922 to introduce what is known today as the Cobb-Douglas production function that has been widely used in economic theory for decades. We employ the R programming language to fit the formulas for the parameters of the Cobb-Douglas production function generated by the authors recently via the bi-Hamiltonian approach to the same data set utilized by Cobb and Douglas. We conclude that the formulas for the output elasticities and total factor productivity are compatible with the original 1928 data.

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  • Roman G. Smirnov & Kunpeng Wang, 2019. "The Cobb-Douglas production function revisited," Papers 1910.06739, arXiv.org, revised Oct 2019.
    • Handle: RePEc:arx:papers:1910.06739
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    References listed on IDEAS

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    1. Jesus Felipe & F. Gerard Adams, 2005. ""A Theory of Production" The Estimation of the Cobb-Douglas Function: A Retrospective View," Eastern Economic Journal, Eastern Economic Association, vol. 31(3), pages 427-445, Summer.
    2. Sato, Ryuzo, 1981. "Theory of Technical Change and Economic Invariance," Elsevier Monographs, Elsevier, edition 1, number 9780126194609 edited by Shell, Karl.
    3. Roman G. Smirnov & Kunpeng Wang, 2019. "The Hamiltonian approach to the problem of derivation of production functions in economic growth theory," Papers 1906.11224, arXiv.org.
    4. Douglas, Paul H, 1976. "The Cobb-Douglas Production Function Once Again: Its History, Its Testing, and Some New Empirical Values," Journal of Political Economy, University of Chicago Press, vol. 84(5), pages 903-915, October.
    5. Prajneshu, 2008. "Fitting of Cobb-Douglas Production Functions: Revisited," Agricultural Economics Research Review, Agricultural Economics Research Association (India), vol. 21(2).
    6. Ryuzo Sato & Rama V. Ramachandran, 2014. "Symmetry and Economic Invariance," Advances in Japanese Business and Economics, Springer, edition 2, number 978-4-431-54430-2, June.
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