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Endogenous Input Prices in Linear Programming Models
Author(s) -
Hazell Peter B. R.
Publication year - 1979
Publication title -
american journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.949
H-Index - 111
eISSN - 1467-8276
pISSN - 0002-9092
DOI - 10.2307/1239433
Subject(s) - linear programming , economics , set (abstract data type) , product (mathematics) , microeconomics , extension (predicate logic) , econometrics , mathematical optimization , computer science , mathematics , geometry , programming language
This paper provides a method for formulating linear programming models in which one or more factors have upward sloping supply schedules, and the prices of these factors are to be endogenously determined at either their competitive market equilibrium values or at the levels set by a monopsonist. The method for achieving these results utilizes the sum, over the relevant factor markets, of the producers' and consumers' surplus, and is an extension of existing methods for solving price endogenous models of product markets.