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Marshall's Rules with Aggregate Inputs
Economics Bulletin (2011)
  • Alberto Behar, World Bank
We establish the formal link between the separability of inputs in a production function and the aggregate elasticity of demand for those inputs. This validates the implicit assumption used when calculating an aggregate elasticity with aggregated input prices and provides a practical approach to calculating an aggregate elasticity when one has disaggregated prices. We illustrate the approach to add to a thin empirical literature on labor demand elasticities in developing countries by using South African data.
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Alberto Behar. "Marshall's Rules with Aggregate Inputs" Economics Bulletin (2011)
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