Discriminating among alternative production functions in Polish industry

Abstract

Large scale econometric models for both market-type and socialist centrally planned economies generally specify production relationships in the form of an aggregate production function. This paper addresses the problem of specifying the functional form of the production function for a socialist centrally planned economy: Poland. Three production functions, Cobb-Douglas, CES and VES, are estimated and a non-nested test for functional form is performed using a pooled cross section-time series regression technique. The estimates of the Cobb-Douglas specification are slightly superior to those of the CES and VES specifications, but the latter provide important detail for historical analysis and interesting implications for growth. © 1984 Physica-Verlag.

Publication Title

Empirical Economics

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