# Tag Info

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### How can I obtain Leontief and Cobb-Douglas production function from CES function?

The proofs I will present are based on techniques relevant to the fact that the CES production function has the form of a generalized weighted mean. This was used in the original paper where the CES ...
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### Why labour, capital, and output levels cannot be pinned down in perfect competition?

Thus, the furthest we can go in terms of characterising the equilibrium in this economy/firm relates to the optimal capital-labour ratio. In effect, nothing can be said about the level of inputs and ...
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### Lessons From Successfully small island economies

I like this question, in the sense that although it is broad, I think it can be answered concisely and factually. Singapore and China (from your previous question) are largely authoritarian countries....
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### Is it true that $\frac{dL}{dq}=1/\frac{\partial q}{\partial L}$?

Question: is the following correct ? $$\frac{dL}{dq}=1/\frac{\partial q}{\partial L},\;\frac{dK}{dq}=1/\frac{\partial q}{\partial K}$$ In general, no. Since $q= f(L,K)$ is a multivariable, ...
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### What exactly is L in a Cobb-Douglas production function?

It can be both. The number of working hours are of course easier to interpret. You can also make the assumption that every employee works some fixed number of hours, say 8 per day (or 220 per month, ...
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### How was the CES production function derived?

The CES function can be derived directly from the condition of constant elasticity of substitution. There are various ways to do this, but the simplest derivation occurs for a homothetic production ...
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### What's the relationship between Output elasticity and Returns to scale?

Define the production function $Q=f(x_1,..,x_k)$, where $x_i$ denotes the ith input. Next recall that the total differential of output can be written as \$\Delta Q = \sum_{i=1}^{\ k}\frac{\partial Q}{\...
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