In this paper we study the relationship between costs, input prices and activity levels in a sample of medium sized, city police departments for the years 1968, 69, 71 and 73. Our focus is on determining the functional structure of law enforcement production technology

We model the decisions of a multi-product firm that faces a fixed "menu" cost: once it is paid, the firm can adjust the price of all its products. We characterize analytically the steady state firm's decisions in terms of the structural parameters: the variability of the flexible prices, the...