Hashemi, Arshia; Kirov, Ivan; Traina, James - 2021
Output and input market distortions manifest as wedges in the firm's first order conditions. The production approach to … markup estimation recovers the markup wedge using the output elasticity for a variable and undistorted input. We show that … evidence of input, rather than output, market distortions. Second, future work can use the production approach to study input …