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Profit Function Approximations and Duality Applications to Agriculture
Author(s) -
Thompson Gary D.,
Langworthy Mark
Publication year - 1989
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 - 10.2307/1242035
Subject(s) - economics , duality (order theory) , substitution (logic) , profit (economics) , mathematics , mathematical economics , monte carlo method , function (biology) , econometrics , computer science , microeconomics , statistics , pure mathematics , evolutionary biology , programming language , biology
Abstract Monte Carlo simulations of profit functions indicate that flexible functional forms may be ranked nearly the same with respect to Allen‐Uzawa partial substitution elasticities or price and fixed factor elasticities. Flexible functional form approximations of output price elasticities are generally worse than approximations of input price or fixed factor elasticities. Minflex Laurent functional forms did not appear to approximate underlying elasticities any better than did their translog and generalized Leontief counterparts.