This study presents an application of the Generalized Error Correction Model (GECM) for heterogeneous factor demands based on the quadratic cost function., Using data for 26 West German manufacturing industries over the period 1976-1995, it turns out that less general specifications such as the...

This study deals with the determinants of factor demand in 27 industries of the manufacturing sector during the period 1978 to 1990. Using a quadratic cost function, six production factors are distinguished : capital, energy, three types of labour and intermediate materials. A parametric test of...

We present a new method for imposing and testing concavity of cost functions using asymptotic least squares, which can be easily implemented even for nonlinear cost functions. We provide an illustration for a (generalized) Box-Cox cost function with six inputs: capital, labor disaggregated in...