Service Production Functions

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. The paper derives production functions designed to model the evolution of service industries. The derivation is based on specifying the output elasticities of the factors according to differential equations and asymptotic technological boundary conditions in factor space. The derived functional forms incorporate labor, capital, energy, and technological parameters, whose time changes model innovation and structural change. The model is applied to the evolution of the German market-determined services 1960-1989. Terms of use: Documents in EconStor may

Cointegration of output, capital, labor, and energy

“…Thus, growth theory that incorporates thermodynamics and cointegration analysis should complement each other in working out the true economic role of energy. In this sense, the present paper tries to complement the studies of Kümmel et al [1,6] and Lindenberger [7].…”

“…Equation (6) is the starting point for cointegration analysis of the economic systems whose growth has been previously investigated by Kümmel et al [6,1]. 7 They are: Germany's total economy (FRG TE) and industrial sector "Warenproduzierendes Gewerbe" (FRG I), 8 Japan's "Industries" (Japan I), the sector "Industries" of the USA (USA I), and 5 If the production function depends explicitly on time, an additional term, dt q ∂q ∂t , occurs in eq. (2).…”

“…Furthermore, these models cannot explain the economic recessions 1973-75 and 1979-81, known as the energy crises due to the first and the second oil price shock. On the other hand, if the equality assumption is dismissed, LINEX production functions, 2 describe economic growth in Germany, Japan, and the USA without Solow residual, and the energy crises of the 1970s are reproduced well [4,5,6,7,8,1]. Their time-averaged output elasticities are for labor much smaller and for energy much larger than the factor cost shares.…”

Thermodynamic laws, economic methods and the productive power of energy

“…(Service production functions similar to the Linex production function have modeled the evolution of German market-determined services between 1960 and 1989 satisfactorily; their time-averaged output elasticities are for labor 0.31 until 1977 and 0.26 after 1978, and for energy they are 0.15 and 0.21, respectively [50]. Thus, even in the labor-dominated sector of the economy, and during times of much less computerized information processing than at present, energy's economic weight exceeds energy's cost share substantially.)…”

A Note on Numerical Estimation of Sato's Two-Level CES Production Function

“…On the other hand, the Differential Evolution and the Repulsive Particle Swarm methods work extremely well and the parameters estimated by them are very close the true ones. Lindenberger (2003) defines the output (Q) of German sector "Market-Determined Services" (for the years 1960-1989) in terms of three factors; capital (K), labour (L) and energy (E). He derives energy-dependent relations by specifying technological boundary conditions for the elasticities of production, and then obtains production functions by integration.…”