A number of papers have discussed the relationship between the Almost Ideal Demand System (AIDS) and its linear approximation (LA/AIDS). In this paper, it is shown that if the prices in the system are normalized to one, the AIDS and LA/AIDS representations are identical at the point of...

Relationships between prices of goods offer motives of interest in at least two areas: market integration and product aggregation. There is a close relationship between market integration and aggregation, which may increase the usefulness of market integration studies. In this article, these...

We introduce the concept “excess capital capacity” and employ a stochastic input requirement frontier to measure excess capital capacity in agricultural production. We also propose a two-step estimation method that allows endogenous regressors in stochastic frontier models. The first step...

In view of widespread capital market imperfections and farmers' budget constraints in developing countries, an indirect production function (IPF) is used for a study of 289 Indian paddy growers. The analysis generalizes the IPF to accommodate the numerous kinds of market imperfections and...

This article deals with specification and estimation of risk preferences, production risk, and technical inefficiency. It makes contribution in three separate areas of production economics. First, we model producers' attitude toward risk and derive risk preference functions (without assuming any...

This paper deals with derivation and implications of profit functions when profit is not maximum due to the presence of either technical inefficiency or allocative inefficiency, or both. We show that input demand and output supply, elasticities, and returns to scale are, in general, affected by...