dynamic corn supply functions a model with explicit optimization both static and dynamic models have been used to estimate aggregate supply elasticities for annual crops the early studies relied on static singleequation models in a few variables assumed static price expectations e g kohls and paarlberg and produced very small estimates of own price supply elasticities e g 0 07 for corn nerlove 1956 1958a and nerlove and addison showed that agricultural supply models incorporating adaptive price expectations and or dynamic resource adjustment produced larger estimates of supply elasticities for corn and other agricultural commodities additionally they showed that supply elasticities obtained from static models need not be bounded by the short run and long run supply elasticities of

is what we think of as rebound really just income effects in disguise this paper examines the question of whether unexpectedly high energy use in the wake of energy efficiency gains can be explained as arising from increases in consumer wealth as opposed to energy efficiency rebound effects the analysis concludes that historical energy consumption increases were driven by more than just income levels with the lowest income consumers in the us using more energy in 2002 than they did in 1987 despite significant energy use efficiency gains and despite declining average incomes in this category further direct use of energy in households increased for all income categories over this time period these results point to rebound as being the culprit not income effects

cost efficiency and electricity market structure a case study of oecd countries the oecd electricity sector has witnessed significant institutional restructuring over the past three decades as a consequence many power generation utilities now act as unregulated companies that technically compete to sell power on an open market this paper analyses the performance in term of cost efficiency for electricity generation in oecd power sector while accounting for the impact of electricity market structures we employ the short run cost function in which capital stock is treated as a quasi fixed factor input empirical models are developed for the cost function as a translog form and analysed using panel data of 25 countries during the period 1980 to 2009 we show that it is necessary to model latent country specific heterogeneity in addition to time varying inefficiency the estimated economies of scale are adjusted to take account of the importance of the quasi fixed capital input in determining cost behaviour and long run constant returns to scale are verified for the oecd generation sector the research findings suggest there is a significant impact of electricity market regulatory indicators on cost in particular public ownership and vertical integration are found to have significant and sizable increasing impacts on cost thereby indicating policy lessons on the desirable ways to implement structural electricity generation reforms

the curious case of corporate tax avoidance is it socially irresponsible in contrast to many aspects of the social responsibility of business csr scholarship has been largely silent on the issue of the payment of corporate tax this is curious because such tax payments are often considered a fundamental and easily measured example of a company s citizenship behavior however because the payment of corporate tax can often be legally avoided this activity represents a boundary condition for csr if the law and csr suggest that a company should pay its fair share of tax yet many successful companies actively avoid this social obligation should they be considered socially irresponsible this paper explores the issue of tax avoidance and the implications it has for any credible definition and measure of csr it also highlights an aspect of corporate practice that is deliberately hidden from public view

a farm firm model of machinery investment decisions this article presents a multiperiod mixed integer programming mmip model of optimal machinery decisions infinite horizon valuation models of replacement and other investment situations are conceptualized in the context of a finite programming model dual properties of the mmip model are used to identify and value opportunity costs involved in investment decisions of farm machinery the interdependent nature of investment and production relationships necessary for solving these values emphasizes the importance of a holistic firm perspective in analyzing farm machinery investment strategies an empirical situation is used to demonstrate model application

investment demand when economic depreciation is stochastic the neoclassical model of investment by a risk neutral firm is generalized to include uncertainty about the rate of depreciation by replacing the deterministic capital accumulation identity with a stochastic variant ito s stochastic dynamic optimization is used to derive conditions for optimal investment a nondegenerate steady state distribution of the capital stock is shown to exist and is derived for the empirically important case of a normalized quadratic profit function and static price expectations it is demonstrated for this case that uncertainty about the rate of depreciation decreases the expected steady state capital stock and investment

accounting for asymmetric price responses and underlying energy demand trends in oecd industrial energy demand abstract this paper explores the way technical progress and improvements in energy efficiency are captured when modelling oecd industrial energy demand the industrial sectors of the developed world involve a number of different practices and processes utilising a range of different technologies consequently given the derived demand nature of energy it is vital when modelling industrial energy demand that the impact of technical progress is appropriately captured however the energy economics literature does not give a clear guide on how this can be achieved one strand suggests that technical progress is endogenous via asymmetric price responses whereas another strand suggests that it is exogenous more recently it has been suggested that potentially there is a role for both endogenous technical progress and exogenous technical progress and consequently the general model should be specified accordingly this paper therefore attempts to model oecd industrial energy demand using annual time series data over the period 1962 2010 for 15 oecd countries using the structural time series model framework the general specifications allow for both asymmetric price responses for technical progress to impact endogenously and an underlying energy demand trend for technical progress and other factors to impact exogenously but in a non linear way the results show that almost all of the preferred models for oecd industrial energy demand incorporate both a stochastic underlying energy demand trend and asymmetric price responses this gives estimated long run income elasticities in the range of 0 34 to 0 96 estimated long run price maximum elasticities in the range of 0 06 to 1 22 estimated long run price recovery elasticities in the range of 0 00 to 0 27 and estimated long run price cut elasticities in the range of 0 00 to 0 18 furthermore the analysis suggests that when modelling industrial energy demand there is a place for endogenous technical progress and an exogenous underlying energy demand trend consequently it is argued that any modelling strategy should start by including both and only imposed restrictions if accepted by the data

factor demand models with nonlinear short run fluctuations abstract this paper considers asymmetric costs of adjustment that propagate nonlinear shortrun fluctuations in stochastic factor demand systems the model endogenously generates asymmetric cyclical demand for capital and labour between peaks and troughs of the business cycle the empirical analysis of the model is based on quarterly time series data of the dutch manufacturing sector for the period 1971 i 1984 iv and annual time series data of the u k manufacturing sector for the period 1955 1986 i find important differences of adjustment speed of capital and labour inputs between expansionary and contractionary phases of the business cycle

output input and productivity measurement in u s agriculture 1948 79 tornqvist theil indexes of outputs and inputs are constructed these data are used to construct indexes of productivity growth over the postwar period the productivity indexes can be derived from a flexible multioutput multifactor representation of the structure of production constrained to constant returns to scale total factor productivity grew at an average annual rate of 1 75 compared with 1 70 per year estimated by the u s department of agriculture the similar estimates of productivity growth overshadow some important differences in measurement of individual inputs the major effort in measuring agricultural productivity is undertaken by the u s department of agriculture usda an american agricultural economics association task force on measuring productivity has examined the sources and procedures used in constructing the official statistics see loomis and barton lambert barton and durost the task force recommended that the usda adopt a series of specific improvements for constructing certain inputs and use an indexing procedure that does not impose a priori restrictions on the structure of production 1 this paper presents revised indexes of outputs and inputs the data are used to construct indexes of productivity growth over the postwar period the productivity indexes can be derived from a flexible multioutput multifactor representation of the structure of production the translog transformation function constrained to constant returns to scale 2 the indexes of outputs and inputs have the same form and their ratio coincides with the estimate of productivity growth

what does tax aggressiveness signal evidence from stock price reactions to news about tax shelter involvement abstract we study the stock price reaction to news about corporate tax aggressiveness we find that on average a company s stock price declines when there is news about its involvement in tax shelters we find some limited evidence for cross sectional variation in the reaction for example the reaction is more negative for firms in the retail sector suggesting that part of the reaction may be a consumer taxpayer backlash in addition the reaction is less negative for firms that are viewed to be generally less tax aggressive as proxied by the firm s cash effective tax rate we interpret this as being consistent with the market reacting positively to evidence that a firm is trying to reduce taxes when their financial reports would lead one to believe the firm is not tax aggressive

is corporate social responsibility performance associated with tax avoidance this study examines whether corporate social responsibility performance is associated with corporate tax avoidance employing a matched sample of 434 firm year observations i e 217 tax avoidant and 217 non tax avoidant firm year observations from the kinder lydenberg and domini database over the period 2003 2009 our logit regression results show that the higher the level of csr performance of a firm the lower the likelihood of tax avoidance our results indicate that more socially responsible firms are likely to display less tax avoidance finally the results from our additional analysis show that the csr categories community relations and diversity represent particularly important elements of csr performance that reduce tax avoidance

investment in u s agriculture resource adjustment problems in u s agriculture are motivated against the background of the farm problem the adjustment cost hypothesis is invoked to specify and estimate consistently a system of dynamic investment demand and output supply equations by utilizing recent advances in dynamic duality theory the investment demand equations assume the form of a multivariate flexible accelerator results indicate that labor capital services and land exhibited quasi fixity while intermediate materials were a variable factor this can be construed as a form of asset fixity within aggregate u s agriculture the univariate flexible accelerator hypothesis is rejected

a nonlinear mixed integer multiperiod firm model abstract we formulate and test an advanced multiperiod model for strategic firm planning this has not been previously considered as a mixed integer nonlinear problem minlp our approach is to show the differences between a linear and a nonlinear mixed integer approach the key property of our model is the simplicity and efficiency of generating optimal firm strategies a cornerstone for managerial acceptance our purpose is to maximize the discounted value of net income and return on investment roi our model has been tested on some major finnish firms and it seems to give reliable results with the data of our sample firm for this paper optimal roi and optimal net income presuppose different strategies when optimizing roi the model balances between cash and fixed assets while optimizing net income results in an intensive investment program even if our sample firm is but one case the results are indicative of some fundamental principles governing managerial decision making

inter linking issues and dimensions in sustainability reporting during the last decade sustainability reporting sr has been increasingly adopted by corporations worldwide this is evidenced by the adoption of several guidelines such as the iso 14000 series the social accountability 8000 standard and the gri sustainability guidelines sr shows promise to help corporate leaders and their employees to contribute towards achieving sustainable societies however most of the guidelines and standards address sustainability issues through comparmentalisation thereby leading to the separation of the economic environmental and social dimensions due to these divisive approaches holistic assessments of the effects of their efforts are seldom properly integrated into coporate decisions and procedures to make improvements for example through cleaner production worker health and safety consumer safety and reductions in the negative short and long term social and environmental impacts this paper analyses sr reports from three companies with the help of grounded theory s constant comparative analysis this analytical framework helped the authors to systematically assess the degree to which the companies addressed economic ecological and social issues separately or in an integrated and inter linked manner from the inter linkages found a new category is proposed to be added to future sr this new category can help corporate sr planners and researchers on sustainability reports to better understand how the company leaders understand their responsibilities with regard to sd these inter connectednesses are highly relevant in many short and long term dimensions of supply chain management global warming ecological disruption and societal equity issues especially with regard to the local national and global energy issues of fuels and oils the central themes of the conference at which this paper was originally presented it also plays a key role in real long term changes towards sustainability where the time dimension plays a key role in human survival on planet earth

supply and demand functions for multiproduct u s cash grain farms biases caused by research and other policies this study presents new estimates of supply and demand elasticities for u s multiproduct cash grain farms and estimates of input and output bias effects caused by public and private crop research extension and farmers schooling the study also shows that the social rate of return to public crop research is large about 62 percent

dynamic input demand functions and resource adjustment for us agriculture state evidence abstract the paper presents an econometric model of dynamic agricultural input demand functions that include research based technical change and autoregressive disturbances and fits the model to annual data for a set of state aggregates pooled over 1950 1982 the methodological approach is one of developing a theoretical foundation for a dynamic input demand system and accepting state aggreage behavior as approximated by nonlinear adjustment costs and long term profit maximization although other studies have largely ignored autocorrelation in dynamic input demand systems the results show shorter adjustment lags with autocorrelation than without dynamic input demand own price elasticities for the six input groups are inelastic and the demand functions possess significant cross price and research effects

dynamic multilevel modelling of industrial energy demand in europe previous studies of industry level energy demand have not accounted for the hierarchical nesting of industries within a system that also adequately allows for country specific determinants of energy demand the principal contribution of this paper is therefore to analyse energy demand for european industries over the period 1995 2009 using a dynamic multilevel model that accounts for this hierarchical data structure among other things we find firstly that our dynamic multilevel model suggests that if industry income and the industry energy price increase by 10 long run energy demand will increase by 8 1 and fall by 6 8 respectively secondly we find that the corresponding long run income and price elasticities are substantially larger in a standard dynamic model of industry level energy demand which does not account for the hierarchical data structure our results therefore suggest that not accounting for the hierarchical data structure results in unreliable estimates of energy demand elasticities from a policy perspective we argue that it is imperative that future industry level energy demand studies account for the hierarchical structure of the data this is to prevent energy policy making being based on industry level evidence that substantially inflates the responsiveness of long run energy demand to income and price changes

investment and disinvestment principles with nonconstant prices and varying firm size applied to beef breeding herds variable beef breeding herd sizes are found to be optimal given cyclical beef prices traditional replacement theory does not allow variable firm size because unequal investment replacement and disinvestment culling rates are not possible if firm size changes cost of production per unit endogenously changes given a u shaped cost curve optimal investment and disinvestment rules for variable firm size are developed based upon the firm s cost curve and discounted net revenue flows for a finite rolling planning horizon current and future investment and disinvestment decisions are linked by their mutual effect on firm size and hence production cost per unit

dynamic factor demand equations in u s and canadian agriculture abstract this research provides one of the first empirical estimates of a data based dynamic factor demand model for american and canadian agriculture models such as these deserve more widespread use in the empirical analysis of agriculture these models have the advantage that they do not impose inappropriate dynamics on the data rather they permit the data to select the appropriate dynamics we use a model originally developed by anderson and blundell this model is a general first order dynamic model which contains as testable hypothesis several simpler models this model permits us to estimate the long run agricultural production structure as a subset of the dynamic parameter estimates we will test this long run structure for symmetry homotheticity and neutral technical change the estimated models may be used to test for three alternative dynamic structures in the limit dynamics may not be needed and we can test for the static long run equilibrium model two intermediate cases are the autoregressive and the partial adjustment models which are simpler than the general model but still include dynamics our results suggest that the long run equilibrium model is unsatisfactory in both countries a dynamic model is needed in both countries the two more restricted dynamic models are rejected the general dynamic model is required in canada the long run equilibrium structure is homothetic with neutral technical change in the united states homotheticity is also accepted but neutral technical change is rejected

dynamic and static behaviour with respect to energy use and investment of dutch greenhouse firms dutch greenhouse horticulture firms are energy intensive and major emitters of greenhouse gases this paper develops a theoretically consistent model that is able to describe the greenhouse firms behaviour regarding energy use and investments in energy technology the behaviour of the firm is modelled using a combination of a dynamic cost function and a static profit function framework the optimal quantity of energy is derived from the link between these two functions the model is applied to a panel of 97 dutch greenhouse firms over the period 2001 2008 the results show that most dutch greenhouse firms shift from being net electricity users to net electricity producers in the long term investing in energy capital contributes to reducing net energy use however it increases the quantity of carbon dioxide emissions due to an increase in electricity production a 1 increase of the price of gas reduces carbon dioxide emissions by 1 6

primal and dual dynamic luenberger productivity indicators abstract this paper develops primal and dual versions of the dynamic luenberger productivity growth measures that are based on the dynamic directional distance function and intertemporal cost minimization respectively the empirical application focuses on panel data of dutch dairy farms over the period 1995 2005 primal dynamic luenberger productivity growth averages 1 5 percent annually in the period under investigation with technical change being the main driver of annual change dual dynamic luenberger productivity growth is 0 1 percent in the same period improvements in technical inefficiency and technical change are partly counteracted by deteriorations of allocative inefficiency with large dairy farms presenting a slightly higher productivity growth than small dairy farms

investment and disinvestment principles with nonconstant prices and varying firm size applied to beef breeding herds comment optimal investment and disinvestment principles have received considerable attention in both general and agricultural economics for over two centuries notable are the works of faustmann samuelson 1937 hirschleifer burt and perrin which establish the basic replacement principle recently trapp presented a reformulation of this basic replacement principle by relaxing the assumptions of constant prices and firm size the purpose of this comment is to discuss a possible misinterpretation of the replacement principle underlying trapp s model specifically the link between trapp s article and previous literature is established with the hope of clarifying any misunderstandings of optimal investment principles trapp states that his equations 3 and 4 which are derived from the discrete time form of the net present value formula for a single asset constitute the appropriate addition and culling investment and disinvestment decision rules for a firm with nonconstant size trapp p 694 this formulation is analogous to perrin s equation 2 which maximizes the returns from an asset over a single rotation in contrast chavas kliebenstein and crenshaw present the asset replacement decision as an optimal control problem with an infinite planning horizon transversality conditions for optimal asset rotation as given in chavas kliebenstein and crenshaw s equation 12 correspond to perrin s equation 4 2 which maximizes the returns from an asset over an infinite horizon reid and bradford in an investigation of investment and disinvestment in farm machinery also derive optimal rotation criteria analogous to perrin s formulation thus it appears that an inconsistency exists in the journal associated with the appropriate replacement rule when expansion and contraction of an operation is endogenously determined should replacement rules be derived from an infinite horizon specification or from a single asset specification the merits of an investment decision must be based not only on earnings from the next production period but also on the rents which can be extracted from the firm s fixed factors failure to consider future assets in a replacement decision implies that changes in replacement costs have absolutely no effect on the optimal life of assets up to the point where it is no longer profitable to operate specifically maximizing over a single asset rotation corresponds to maximizing the internal rate of return of an investment decision with a discount rate quivalent to the internal rate of return samuelson 1976 the quantitative effects of considering only a single asset specification are minimal depending on the length of the asset rotation and the discount rate employed as the rotation length increases or a larger discount rate is employed representation of the optimal replacement rule will converge to perrin s equation 2 samuelson 1976 the turnpike theorem states that if the asset rotation is of sufficient length where the end of the horizon has o influence on period decisions the system then converges towards the von neumann path boussard too short a length may result in the system never converging toward the von neumann path alternatively if the salvage and acquisition values are equal at any point in time then the von neumann path will be reached at the beginning of the last period however in general asset replacement is costly and thus access to the von neumann path is not instantaneous the apparent inconsistent use of a single asset specification in contrast to basic replacement principles associated with an infinite horizon may be resolved by investigating the theoretical results in chavas and klemme employing an optimal control methodology with a finite planning horizon t a distinction among rules derived from alternative specifications is evident using perrin s terminology chavas and klemme generalize the replacement criteria for a system with multiple constraints

an opportunity cost view of fixed asset theory and the overproduction trap comment in a 1981 ajae article johnson and pasour criticize the works of edwards and glenn johnson 1972 and earlier publications for attributing persistent excess production in agriculture to an asset fixity theory which at its crux relies on divergences between asset acquisition costs and asset salvage values johnson and pasour mjp pinpoint their critique of edwards and johnson ej when they state p 3 the conclusion of fixed asset theory that excess resources are trapped in production can be traced directly to selection of acquisition prices of resources as a benchmark for equilibrium production but there is no reason to expect the opportunity cost of a resource once acquired to equal its historical acquisition price in his 1982 ajae reply to mjp glenn johnson contends that the ej formulation does contrary to the mjp assertion allocate resources on the basis of opportunity costs including the cases where opportunity cost is equal to current not historical acquisition cost or ourrent not historical salvage value the primary purpose of this paper is to discuss briefly how mjp s article is lacking in a key respect it ignores intertemporal opportunity costs of durable resources to achieve brevity and expositional clarity other aspects of differences between mjp and ej are avoided insofar as the specifics of this paper allows conventional resource adjustment theory is reviewed by mjp their equations 1 4 pp 1 2 stress is placed on the usual hypothesis that the equilibrium use of durable resources similar to nondurables occurs when each durable s value of marginal product just equals its marginal factor cost this equilibrium relation is hypothesized for a profit maximization firm to hold for each durable resource or asset in each production or planning period t but this engine of analysis while acceptable for nondurable resources lacks crucial detail for dealing with the multiperiodicity of durable resources essentially it is a monoperiodic engine or at best it is a sequential monoperiodic engine it avoids defining the time horizon the finite or infinite span of t hence it avoids a precise definition of the relevant set of investment disinvestment and production activities to be considered by the decision maker more specifically even if t can be limited to a finite number of periods s intertemporal opportunity costs associated with each durable resource are ignored assumed by implication to not exist or assumed to equal zero to paraphrase perrin who mjp acknowledge as having reviewed their paper these are the costs of postponing the earnings which will be forthcoming from the series of replacement or new investment durable assets for the currently owned or currently considered asset moreover if the appropriate span of t is infinite it becomes even more important not to ignore intertemporal opportunity costs this point was illustrated conceptually by perrin in his figure 1 p 61 when considering optimal investment disinvestment in and use of durables multiperiod models which explicitly account for time money relationships are judged by most economic analysts to be preferable to conventional static monoperiodic models wealth maximization becomes the norm as opposed to one period profit maximization present value equations which model flows of acquisition prices ensuing quasi rents and salvage values of durables or their derived first order marginal optimizing inequalities take over the role of simple static vmp mfc equalities in what follows the resource adjustment rule hypothesized by mjp is compared with the marginal rules derived by perrin rules and logic which are presented in various earlier and subsequent texts and other publications on capital investment equation 3 in mjp p 2 summarizes their durable resource adjustment rule as follows

substitution and price elasticity estimates using inter country pooled data in a translog cost model pooled data across several developing countries and the u s were used to estimate long run substitution and price elasticities ina translog framework for the paper iron and steel and aggregatemanufacturing industries while the quality of the estimates variesacross the several industry specific models the results suggest highervalues for these elasticities than appear commonly used in integratedassessment models estimates of own price elasticities of energy rangefrom 0 80 to 1 76 and are comparable to estimates from previouseconometric studies in the context of developed countries 0 77 to 0 87 substitution elasticities show wider variation across countriesand industries for energy and capital they range from 1 96 to 9 80 forlabor and energy from 2 61 to 7 11 and for energy and material from 0 26 to 2 07

a dynamic adjustment model for u s agriculture 1948 79 abstract a multioutput model is developed within the adjustment cost framework to analyze the structure of dynamic adjustments in u s agriculture during the post war period an important feature of this model is that the econometric model is consistent with dynamic economic theory fluctuations in capital stocks variable inputs and outputs are explained by changing opportunity costs empirical results indicated that durable equipment farm produced durables and family labor exhibited significant rigidity in adjustment as a response to exogenous shocks surprisingly the hypothesis that real estate was a variable input could not be rejected the univariate flexible accelerator hypothesis which is widely maintained in most agricultural adjustment studies is inconsistent with the data

costs of adjustment the aggregation problem and investment this paper looks at the empirical consequences of inappropriately using a representative firm to mimic the aggregate investment decisions of a group of heterogeneous firms faced with costs of adjusting capital inputs improper aggregation generates a bias with two important consequences 1 an apparent insensitivity of the aggregate capital stock to the user cost of capital and 2 predicted responses of the capital stock to shocks that are considerably slower than observed both of these consequences are features of available investment equations copyright 1992 by mit press

is corporate responsibility converging a comparison of corporate responsibility reporting in the usa uk australia and germany corporate social reporting while not mandatory in most countries has been adopted by many large companies around the world and there are now a variety of competing global standards for non financial reporting such as the global reporting initiative and the un global compact however while some companies e g henkel bhp johnson and johnson have a long standing tradition in reporting non financial information other companies provide only limited information or in some cases no information at all previous studies have suggested that there are country and industry specific differences in the extent of csr reports e g kolk et al 2001 business strategy and the environment10 15 28 kolk 2005 management international review45 145 166 maignan and ralston 2002 journal of international business studies33 3 497 514 however findings are inconclusive or contradictory and it is often difficult to compare previous studies owing to the idiosyncratic methods used in each study graafland et al 2004 journal of business ethics53 137 152 furthermore previous studies have relied mainly on simple measures such as word counts and page counts of reports to compare the extent of reporting that may not capture significant differences in the content of the reports in this article we seek to overcome some of these deficiencies by using textual analysis software and a more robust statistical method to more objectively and reliably compare the csr reports of firms in different industries and countries we examine a sample of leading companies in four countries us uk australia and germany and test whether or not membership of the global compact makes a difference to csr reporting and is overcoming industry and country specific factors that limit standardization we conclude that globalcompact membership is having an effect only in certain areas of csr reporting related to the environment and workers and that businesses from different countries vary significantly in the extent to which they promote csr and the csr issues that they choose to emphasize in their reports these country differences are argued to be related to the different institutional arrangements in each country

the multivariate flexible accelerator model its empirical restrictions and an application to u s manufacturing this paper derives an exhaustive set of restrictions implied by the multistock flexible accelerator specification of the adjustment cost model for the firm the flexible accelerator specification of the demand for capital and labor is estimated using u s manufacturing annual data for the 1947 1976 period the consistency of the data with the model is examined by testing the validity of the derived restrictions finally the conditions which permit aggregation over firms are determined and tested empirically the flexible accelerator specification has been popular in the empirical literature on interrelated investment and employment decisions see nadiri and rosen 38 coen and hickman 10 and schramm 40 more recent examples include sargent 39 berndt fuss and wavermann 4 berndt and morrison 6 and meese 34 under suitable assumptions the specification may be rationalized by the adjustment cost model of the firm eisner and strotz 13 lucas 30 mortensen 35 extends the work of lucas and derives some empirically testable restrictions of the accelerator specification that are implied by the adjustment cost framework the broad objective of this paper is to provide a more rigorous and comprehensive test of the adjustment cost model than is presently found in the literature this objective is achieved in three stages first we offer an alternative derivation of the mortensen restrictions and more importantly we prove theorem 1 that his restrictions are exhaustive i e we establish an integrability result for the flexible accelerator adjustment cost model second the flexible accelerator specification of the demand for capital and labor is estimated using total u s manufacturing annual data for the 1947 76 period it is assumed that firms minimize expected production costs subject to a technology which implies that capital and labor stocks are costly to adjust while a third factor materials is freely adjustable the consistency of the data with the adjustmentcost framework is examined by testing for the validity of the derived restrictions further we test the validity of some separability restrictions on the adjustmentcost technology that to varying degrees are imposed a priori in all of the cited empirical studies finally we provide a complete characterization of the individual firm technologies which justify the common assumption of the existence of a representative firm this problem of aggregation over firms which has been

output response to prices and public investment in agriculture indonesian food crops abstract this paper analyzes dynamic food crop supply response in indonesia the effects of technology prices and investments on output growth for rice corn soybean and cassava are examined the analysis generates crop wise area yield and input demand parameters suitable for the evaluation of price and investment policies and shows the large impact of public investment in agricultural research extension and irrigation on long run output growth in indonesia elimination of the fertilizer subsidy and reinvestment of the resulting fiscal savings in research extension and irrigation would produce large benefits

decomposing energy demand across briic countries energy plays an important role within the production technology of fast emerging economies such that firms reaction to changes in energy prices provides useful information on factor productivity and factor intensity as well as the likely outcome of energy policy initiatives among other things drawing on duality theory this paper decomposes changes in energy demand into substitution and output effects using annual sector level production data for brazil russia india indonesia and china briic for the period 1995 2009 unlike previous studies this study analyzed the economic properties of the underlying production technology results indicate that changes in energy demand are strongly dominated by substitution effects more importantly an intriguing finding that emerges from our analysis is the role of economies of scale and factor accumulation as opposed to technical progress in giving rise to the growth performance of sampled economies

decompositions of corn price effects implications for feed grain demand and livestock supply this article examines how corn prices affect the demand for feed grains and the supply of livestock outputs the differential approach to the theory of the multiproduct firm is employed to examine ex ante decisions about feed grain demand and livestock supply the estimation results suggest that livestock producers have little flexibility in adjusting the demand for corn in response to an increase in corn prices the substitutable relationship between corn and distillers grains contributes to alleviating pressures on feed costs in response to high corn prices in addition the estimation results highlight that the composition of livestock supply can be altered by changes in livestock prices on the basis of the estimated elasticities the decompositions of profit maximizing input demand are conducted to examine the effects of changes in corn prices on feed grain demand and livestock supply the decomposition results reveal that an increase in corn prices reduces corn demand but raises the demand for distillers grains mainly due to the substitution effects of corn price changes the decomposition results also show that an increase in the price of corn reduces cattle supply but raises the supply of chicken and pork due to the output relationships in supply

measuring the energy input substitution and output effects of energy price changes and the implications for the environment abstract previous studies of decomposition of factor inputs have limited their analysis on the estimation of substitution and output effects however this paper develops a two step approach to estimate the substitution and output effects of changes in energy demand resulting from changes in prices and further examines the implications of these effects on co2 emissions using european industrial dataset over the period 1995 2007 in our empirical estimations instead of relying only on isur model like previous studies we introduced a multilevel model which is a more befitting model to our data our analysis covers industry as a whole and for different sector types the primary results emerged from our analysis suggest a strong evidence using the multilevel model generally our results show that production inputs are substitutable we find the substitution and output effects to be negatively related to co2 emissions however the substitution effects dominate from policy perspectives our results suggest that output adjustments may not play a significant role in reducing emissions we find the overall effects of changes in energy demand to be moderate then we argue that increment in energy taxes should be complemented by cleaner factor substitution and sustainable growth to achieve a desirable carbon reduction

fuel conserving and using production functions abstract this article compares eight production cost functions used or potentially useful for exploring how energy efficiency gains affect energy consumption we show the practitioner s choice of function can inadvertently pre determine results and make recommendations as to which functions are flexible enough to prevent this we also show pre selected factor substitution elasticities can similarly pre determine results to aid the comparison we decompose the energy consumption rebound effect into intensity and output income effects which also delivers insight into the mechanisms of rebound we conclude by recommending practitioners restrict themselves to either the gallant fourier or the generalized leontief symmetric generalized barnett cost functions as being sufficiently rebound flexible the translog cost function may be suitable given certain conditions and a particular form of the ces solow function is a possible but problematic candidate along the way the article provides a general methodology for similarly examining any arbitrarily defined constant returns to scale production or cost function

optimal replacement policies for rejuvenated assets the faustmann samuelson solution for optimal asset rotation is extended to consider both asset rejuvenation and nonconstant prices a dynamic theoretical model is developed in terms of an optimal control problem with discontinuous control variables and numerical solution procedures are outlined the model is applied to layer hen replacement where hen rejuvenation by forced molting is a common industrial practice results indicate a sensitivity between the decision to rejuvenate or replace a hen and the egg price cycle suggesting a mixed rotation strategy

modelling energy and non energy substitution a brief survey of elasticities estimating the degree of substitution between energy and non energy inputs is the key for any evaluation of environmental and energy policies yet given the variety of substitution elasticities the central question arises as to which measure would be most appropriate apparently allen s elasticities of substitution have been the most used measures in applied production analysis in line with frondel 2004 this paper argues that cross price elasticities are preferable for many practical purposes this conclusion is based on a survey of classical substitution measures such as those from allen morishima and mcfadden the survey highlights the fact that cross price elasticities are their essential ingredients

productivity growth of east asia economies manufacturing a decomposition analysis abstract applying a stochastic production frontier to sector level data within manufacturing this paper examines total factor productivity tfp growth for seven east asian economies during 1963 98 using both single country and cross country regressions the analysis focuses on the trend in technological progress tp and technical efficiency change tec and the role of productivity change in economic growth the empirical results reveal that although input factor accumulation is still the main source for east asian economies growth tfp growth is accounting for an increasing and important proportion of output growth among which the improved tec plays a crucial role in productivity growth

taboo or technical issue an empirical assessment of taxation in sustainability reports abstract prior literature offers mixed evidence on the existence of a link between corporate taxation and corporate social responsibility csr this article contributes to this debate by examining the level of tax disclosure in sustainability reports by firms listed in the united states the united kingdom and germany from 2007 to 2012 the aim is to offer micro level evidence of whether firms themselves perceive corporate tax payments as being part of their csr on the basis of a hand collected 540 firm year dataset of ninety publicly listed firms the article shows that the level of tax disclosure was rather low however it did increase over time and was most prevalent in the united kingdom moreover the reports indicate considerable variation in attitudes toward taxation overall the widespread silence on tax issues and a non uniform treatment of taxation in sustainability reports underline the complex role of tax payments when it comes to csr examination of determinants of disclosure shows that firms with lower effective tax rates negative media coverage in tax matters and industry specific stakeholder pressure were generally more inclined to disclose tax information which is in line with predictions based on stakeholder and legitimacy theory finally the article discusses the importance of cultural and social norms when it comes to tax related sustainability reporting and provides theoretical as well as regulatory implications

dynamic factor demands and market structure under rational expectations some estimates for the italian manufacturing system this paper deals with a dynamic model of the behaviour of firms under rational expectations the adjustment cost framework is followed to describe production technologies the objective of firms is to maximize the stream of future profits under rational expectation first order conditions for the optimum are derived with respect to input demands and one output supply the output market structure is modelled in order to test price taking behaviour the adjustment costs of quasi fixed inputs are internal and interrelated the model is estimated for the italian manufacturing system with encouraging results

energy and capital substitutes or complements a note on the importance of testing for non neutral technical progress this note investigates the importance of testing the validity of the hicks neutral technical progress assumption in the context of examining the substitutability or complementarity between capital labour and energy in the uk industrial sector it is found that the hypothesis of neutral technical progress must be rejected in favour of the non neutral hypothesis with technical progress thus biased to using both capital and energy but to saving labour in addition it is found that all three factors are substitutable for one another when non neutral technical progress is modelled

dynamic factor demands under rational expectations we model the industrial demands for structures equipment and blue and white collar labor in a manner consistent with rational expectations and stochastic dynamic optimization in the presence of adjustment costs but allowing generality of functional form we represent the technology by a translog input requirement function that specifies the amount of blue collar labor needed to produce an output level given quantities of three quasi fixed factors nonproduction workers equipment and structures a complete description of the production structure is obtained by simultaneously estimating the input requirement function and three stochastic euler equations we find adjustment costs are small in total but large on the margin and differ considerably across factors

energy and capital substitutes or complements some results for the uk industrial sector this paper investigates the substitutability or complementarity possibilities between capital labour and energy in the uk industrial sector with particular attention to the captial energy relationship it is found using the translog cost function approach that capital and labour as well as energy and labour are substitutes however capital and energy are found to be complements

adjustment cost and supply response in a fishery a dynamic revenue function in industries where firms can adjust product mix in response to price changes the process can be delayed by adjustment costs an example is fishermen who change fishing grounds to target different species if adjustment costs are sufficiently large this may hamper the fishermen s response so that regulatory tools that are not efficient in the long run are useful in the short run moreover adjustment costs can influence the choice of species targeted in this paper dynamic supply equations are specified using a revenue function approach different hypotheses about the dynamics of the supply equations are tested for norwegian trawlers

net investment in farm tractors an econometric analysis a wide range of assumptions about the capital deterioration and marginal factor cost of tractors has been made in previous studies this study develops a measure of the implicit rental price of tractors which accounts for the capital structure used by farmers the capacity depreciation of tractors and income tax considerations estimates of net investment models for alternative capacity depreciation patterns are compared to those suggested by engineering considerations the results show that the frequently used geometric decay pattern does the poorest job of explaining annual real net investment in farm tractors

duality the output effect and applied comparative statics except for kako agricultural production studies using cost functions have analyzed technology via allen elasticities technological change parameters and homotheticity tests kako used a transcendental logarithmic translog cost function to decompose empirically changes in derived factor demand into three separate components output level factor substitution effects and technical change kako s work allows further investigation of technical change on derived factor demands however kako s output effect is different from the traditional concept the production analog of the income effect in consumer theory this note outlines a theoretical and econometric approach for measuring the output effect the output effect is important because it presents a more complete picture of factor employment adjustments than do demand elasticities generated from cost functions elasticities generated from cost functions restrict the producer to a given level of output producers however may also adjust output as factor prices change the output effect captures this adjustment this paper demonstrates a method for deriving the output effect from the cost function first the general assumptions and the model are outlined then the cost function is related to the indirect production function and the output effect obtained results are presented for the special case of a homothetic production function the paper concludes with an empirical application to the u s meat products industry

intertemporal price indices for the firm abstract a notion of intertemporal price aggregation is analysed within the adjustment cost model of the firm and is shown to be feasible precisely for those technologies which imply an accelerator adjustment rule a unique feature of the common quadratic production function specification is established the analysis is shown to be relevant to the possibility of decentralization within the firm to functional form specification for dynamic demand functions and to comparative dynamics analysis

interrelated factor demands for manufacturing a dynamic translog cost function approach abstract in this paper we report the results of estimating a joint model for labour capital and energy using the transcendental logarithmic cost function of christensen jorgenson and lau 1973 this allows us to determine both the own price and cross elasticities of substitution between labour capital and energy we combine a model of factor shares with a dynamic adjustment process for each factor we also impose on the cross equation restrictions necessary to provide additivity homogeneity and symmetry since the covariance matrix in systems of share relationships is singular we follow the suggestions of anderson and blundell 1982 and employ a mullivariate error corrrection model the results suggest that additivity symmetry and homogeneity restrictions do hold and that there are short run increasing returns to scale