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CHOICE OF TECHNIQUES AND THE THEOREM OF OKISHIO
Author(s) -
Warskett G.
Publication year - 1991
Publication title -
metroeconomica
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.256
H-Index - 29
eISSN - 1467-999X
pISSN - 0026-1386
DOI - 10.1111/j.1467-999x.1991.tb00363.x
Subject(s) - profit (economics) , economics , mathematical economics , rate of profit , mathematics , profit rate , basis (linear algebra) , microeconomics , econometrics , geometry
This paper discusses the sufficiency of the »viability condition« of Okishio's theorem for signalling profit improving choice of techniques. Some counter‐examples are given for linear technologies with joint production. Technological change which conform to the prediction of the theorem ‐ choices made on the basis of the viability condition lead to higher average rate of profit ‐ is called regular , and sufficient conditions for regularity are specified.