Introduction to Econometric Production Analysis with R

Introduction
Objectives of the course and the lecture notes
An extremely short introduction to R
Some commands for simple calculations
Creating objects and assigning values
Vectors
Simple functions
Comparing values and Boolean values
Data sets (``data frames'')
Functions
Simple graphics
Other useful commands
Extension packages
Reading data into R
Linear regression
R packages
Data sets
French apple producers
Description of the data set
Abbreviating name of data set
Calculation of input quantities
Calculation of total costs, variable costs, and cost shares
Calculation of profit and gross margin
Rice producers on the Philippines
Description of the data set
Mean-scaling quantities
Logarithmic mean-scaled quantities
Mean-adjusting the time trend
Total costs and cost shares
Specifying panel structure
Mathematical and statistical methods
Aggregating quantities
Concave and convex functions
Quasiconcave and quasiconvex functions
Delta method
Primal Approach: Production Function
Theory
Production function
Average products
Total factor productivity
Marginal products
Output elasticities
Elasticity of scale and most productive scale size
Marginal rates of technical substitution
Relative marginal rates of technical substitution
Elasticities of substitution
Direct elasticities of substitution
Allen elasticities of substitution
Morishima elasticities of substitution
Profit maximization
Cost minimization
Derived input demand functions and output supply functions
Derived from profit maximization
Derived from cost minimization
Suitability of the production function for econometric applications
Productivity measures
Average products
Total factor productivity
Linear production function
Specification
Estimation
Properties
Predicted output quantities
Marginal products
Output elasticities
Elasticity of scale
Marginal rates of technical substitution
Relative marginal rates of technical substitution
First-order conditions for profit maximization
First-order conditions for cost minimization
Derived input demand functions and output supply functions
Cobb-Douglas production function
Specification
Estimation
Properties
Predicted output quantities
Output elasticities
Marginal products
Elasticity of scale
Marginal rates of technical substitution
Relative marginal rates of technical substitution
First and second partial derivatives
Elasticities of substitution
Direct elasticities of substitution
Allen elasticities of substitution
Morishima elasticities of substitution
Quasiconcavity
First-order conditions for profit maximization
First-order conditions for cost minimization
Derived input demand functions and output supply functions
Derived input demand elasticities
Quadratic production function
Specification
Estimation
Properties
Predicted output quantities
Marginal products
Output elasticities
Elasticity of scale
Marginal rates of technical substitution
Relative marginal rates of technical substitution
Quasiconcavity
Elasticities of substitution
Direct elasticities of substitution
Allen elasticities of substitution
Comparison of direct and Allen elasticities of substitution
First-order conditions for profit maximization
First-order conditions for cost minimization
Translog production function
Specification
Estimation
Statistical significance of individual inputs
Properties
Predicted output quantities
Output elasticities
Marginal products
Elasticity of scale
Marginal rates of technical substitution
Relative marginal rates of technical substitution
Second partial derivatives
Quasiconcavity
Elasticities of substitution
Direct elasticities of substitution
Allen elasticities of substitution
Comparison of direct and Allen elasticities of substitution
Mean-scaled quantities
First-order conditions for profit maximization
First-order conditions for cost minimization
Evaluation of different functional forms
Goodness of fit
Test for functional form misspecification
Theoretical consistency
Plausible estimates
Summary
Non-parametric production function
Dual Approach: Cost Functions
Theory
Cost function
Properties of the cost function
Cost flexibility and elasticity of size
Homotheticity of cost functions
Short-run cost functions
Cost functions with multiple outputs
Suitability of the cost function for econometric applications
Cobb-Douglas cost function
Specification
Estimation
Properties
Estimation with linear homogeneity in input prices imposed
Checking concavity in input prices
Homotheticity
Optimal input quantities
Optimal cost shares
Derived input demand functions
Derived input demand elasticities
Cost flexibility and elasticity of size
Marginal costs, average costs, and total costs
Cobb-Douglas short-run cost function
Specification
Estimation
Properties
Estimation with linear homogeneity in input prices imposed
Cobb-Douglas cost function with multiple outputs
Specification
Properties
Cost flexibility and elasticity of size
Translog cost function
Specification
Estimation
Linear homogeneity in input prices
Estimation with linear homogeneity in input prices imposed
Cost flexibility and elasticity of size
Homotheticity
Marginal costs and average costs
Derived input demand functions
Derived input demand elasticities
Theoretical consistency
Translog cost function with multiple outputs
Specification
Properties
Dual Approach: Profit Function
Theory
Profit functions
Short-run profit functions
Graphical illustration of profit and gross margin
Cobb-Douglas profit function
Specification
Estimation
Properties
Estimation with linear homogeneity in all prices imposed
Checking convexity in all prices
Predicted profit
Optimal profit shares
Derived output supply and input demand functions
Derived output supply and input demand elasticities
Cobb-Douglas short-run profit function
Specification
Estimation
Properties
Estimation with linear homogeneity in all prices imposed
Returns to scale
Shadow prices of quasi-fixed inputs
Efficiency Measures
Technical efficiency
Output-oriented technical efficiency with one output
Input-oriented technical efficiency with one input
Output-oriented technical efficiency with two or more outputs
Input-oriented technical efficiency with two or more inputs
Allocative efficiency, revenue efficiency, cost efficiency
Output-oriented allocative efficiency and revenue efficiency
Input-oriented allocative efficiency and cost efficiency
Profit efficiency
Scale efficiency
Stochastic Frontier Analysis
Stochastic production frontiers
Specification
Marginal products and output elasticities in SFA models
Skewness of residuals from OLS estimations
Cobb-Douglas stochastic production frontier
Estimation
Variance parameters
Statistical tests for inefficiencies
Obtaining technical efficiency estimates
Truncated normal distribution of the inefficiency term
Translog production frontier
Estimation
Statistical test for inefficiencies
Testing against the Cobb-Douglas functional form
Obtaining technical efficiency estimates
Truncated normal distribution of the inefficiency term
Translog production frontier with mean-scaled variables
Stochastic cost frontiers
Specification
Skewness of residuals from OLS estimations
Estimation of a Cobb-Douglas stochastic cost frontier
Short-run cost frontiers
Profit frontiers
Analyzing the effects of z variables
Production functions with z variables
Production frontiers with z variables
Efficiency effects production frontiers
Decomposition of cost efficiency
Data Envelopment Analysis (DEA)
Preparations
DEA with input-oriented efficiencies
DEA with output-oriented efficiencies
DEA with ``super efficiencies''
DEA with graph hyperbolic efficiencies
Distance Functions
Theory
Output distance functions
Properties
Distance elasticities
Elasticity of scale
Optimising behaviour and distance elasticities
Obtaining unobserved output prices
Input distance functions
Properties
Distance elasticities
Elasticity of scale
Cobb-Douglas output distance function
Specification
Estimation
Distance elasticities
Elasticity of scale
Properties
Non-increasing in input quantities
Non-decreasing in output quantities
Quasiconvex in input quantities
Convex in output quantities
Efficiency estimates
Translog output distance function
Specification
Estimation
Distance elasticities
Elasticity of scale
Properties
Non-increasing in input quantities
Non-decreasing in output quantities
Quasiconvex in input quantities
Convex in output quantities
Efficiency estimates
Cobb-Douglas input distance function
Specification
Estimation
Distance elasticities
Elasticity of scale
Properties
Non-decreasing in input quantities
Non-increasing in output quantities
Concave in input quantities
Quasiconcave in output quantities
Efficiency estimates
Translog input distance function
Specification
Estimation
Distance elasticities
Elasticity of scale
Efficiency estimates
Imposing monotonicity
Panel Data and Technological Change
Average production functions with technological change
Cobb-Douglas production function with technological change
Pooled estimation of the Cobb-Douglas production function with technological change
Panel data estimations of the Cobb-Douglas production function with technological change
Translog production function with constant and neutral technological change
Pooled estimation of the Translog production function with constant and neutral technological change
Panel-data estimations of the Translog production function with constant and neutral technological change
Translog production function with non-constant and non-neutral technological change
Pooled estimation of a translog production function with non-constant and non-neutral technological change
Panel-data estimations of a Translog production function with non-constant and non-neutral technological change
Frontier production functions with technological change
Cobb-Douglas production frontier with technological change
Time-invariant individual efficiencies
Time-variant individual efficiencies
Observation-specific efficiencies
Fixed effects in the production frontier
Translog production frontier with constant and neutral technological change
Observation-specific efficiencies
Translog production frontier with non-constant and non-neutral technological change
Observation-specific efficiencies
Decomposition of productivity growth
Analyzing productivity growths with Data Envelopment Analysis (DEA)
Cost functions with technical change
Translog cost function with constant and neutral technical change
Translog cost function with non-constant and non-neutral technical change