Published October 6, 2017
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Elasticities of Substitution and Firm Behavior
- Creators
- Shin, Euisoon
Abstract
This paper investigates a firm's response to a factor price change in a competitive industry. R. G. D. Allen showed that the cross factor price elasticity is related in a particular manner to the elasticity of substitution under certain conditions. By introducing functional separability in the discussion, this paper transforms Allen's equation into one which explicitly incorporates the relation between the Allen partial elasticity of substitution and the intra- and inter-group elasticities of substitution.
Additional Information
I would like to thank Roger Noll, Ed Green, and participants in the Economic Theory Workshop at Caltech.Attached Files
Submitted - sswp385.pdf
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sswp385.pdf
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Additional details
- Eprint ID
- 82126
- Resolver ID
- CaltechAUTHORS:20171005-142422867
- Created
-
2017-10-06Created from EPrint's datestamp field
- Updated
-
2019-10-03Created from EPrint's last_modified field
- Caltech groups
- Social Science Working Papers
- Series Name
- Social Science Working Paper
- Series Volume or Issue Number
- 385