... 4 Estimates under Hicks Neutral Technologi cal Change In this section, I present
estimates of the elasticity of substitution between capital and labor based on both
classical regression analysis and modern time series analysis. ...

... 2 ) . Geometrically these conditions state that output per unit of labor is an increas- ing function
of the input of capital per unit of labor, convex from ... value of A. This way of generating production
functions brings to light a connection with the elasticity of substitution which does ...

... The elasticity of substitution between capital and labor is represented by ß 1 , the coefficient of
interest. ... We use the weighted-symmetric test to determine the order of integration for each series
across industries, the ratio of capital to labor inputs, and the corresponding relative ...

... Allen (1938, p. 504) defined the partial elasticity of substitution between inputs i and j by ... LYKKJ
The disturbances UL and UK are likely to be correlated, because random deviations from profit
maximization should affect both the markets for labor and capital. ...

... If the capital-labor ratio increases, the efficiency gain is labor-saving. This implies that the labor
share declines at a constant factor price ratio. ... marginal products the cost function has the same
disadvantage as the production function in estimating elasticities of substitution. ...

... is more than twice its standard error. of capital-labor ratio nearly twice its standard error.
5- '4) Page 10. TABLE 2 Intercountry Estimates of the Elasticity of Substitution for Two-Digit
Manufacturing Industry, Murata-Arrow Industry Data for 1953-56: ...

... If production is represented by a Constant Elasticity Of Substitution specification, then the price
elasticity is identical to the substitution elasticity between labor and capital, which is represented
as a parameter, a9 The third section ... and substitution elasticities are equal. 342 ...

... The manufacturing energy, labor, and capital cost shares'(valued at factor cost) were derived
from United ... was taken to include all wage and salary supplements to avoid overestimat- ing capital
costs ... Thus we report in Tables 2 and 3 below the elasticities of substitution and price ...

... ai represents the elasticity of substitution between capital-in-general and labour-in-general. ...
When prices of capital and of labour are given, entrepreneurs would determine the optimum
combination of capital and labour to produce a given level of output. ...

... Corbo, V and P. Meller (1982), "The Substitution of Labor, Skill and Capital: Its Implications for ...
4 Taking logarithm from the first order condition with respect to labor (equation (2)) we get ... He
concludes that there is little evidence of variable elasticity of substitution (s as function of ...

... 8 Identification becomes easier, if factor income shares as well as the capital-output ratio are
nonstationary, because in that case the estimation of the elasticity of substitution depends on
the ... Page 5. production function is CES with labor-augmenting technical change. ...

... I also present alternative estimates with a constant elasticity of substitution production function.
The Cobb-Douglass function has the advantage of simplicity so ... Summing these gives (4) total
labor cost 2 L N W ... 6 data. The expression for the price of capital is given in equation (5). ...

... However, if -0, so that the substitution elasticity is less than one, a relative improvement in the ...
the equation are the ratio of labor income to the sum of labor and capital Ž . ... unskilled workers,
also follows from the firm's profit-maximizing decision in hiring skilled and unskilled labor. ...

... YY (q/p)M, and the SK curve is now a relationship between esL, the share of labor in value added
given by esL wL/(p˜Y), and ˜k K/eY, the capital-value added ... of ˜ k but also of q/p. Let us examine
the implications of this extension for both the elasticity of substitution and the ...

... (1) we have a nested CES function where inputs capital K and labour L are ... rate of the
energy-output ratio e - q from the (negative of the) growth rate of their relative price p Q - p E ,
the substitution possibilities s ... (7), which gives us the growth rate of the share of capital costs in ...

... with the seminal analysis of Harberger (1959, 1962), the substitution elasticity between capital
and labor, equivalent to ... series) is the product of the spectrum of the input series (eg, the
capital/output ratio ... When the elasticity of substitution is unity, ? equals zero, and uft vanishes ( ...

... Function (where c- = a + bk) The production function (9) is based on the linear elasticity of factor
substitution function C = a ... data for Y and K, but not for r or w. But we do have time series data
for capital's share, denoted as a, and we deduce the series for labor's share as ...

... may be a statistical fiction related to the relatively low estimate of the elasticity of substitution
between capital and labor ... of increasing speed of adjustment) are government, housing services,
manufacturing, construction, agriculture, and transportation (if labor is the ...

... In the CES technology (2), biased technical change is represented by temporal variation in ? ... reject
the hypothesis that s is 1, the value implied by the Cobb–Douglas production function and often ...
Chirinko, Fazzari, and Meyer: The Elusive Capital–Labor Substitution Elasticity ...

... ? l y - s uc l t * + v t l y ,. where ky t * = ln ( ( K / Y ) t * ) , ? ky = s ln ( ? ) , s is the substitution
elasticity, ucc t * = ln ( ( P k / P Y ) t * ) , (the Jorgensonian user cost of capital), v t ... ln ( ( L / Y )
t * ) , ? l y = s ln ( 1 - ? ) ,uc l t * = ln ( ( P L / P Y ) t * ) (the user cost of labor or the ...