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st: Von Liebig Production Function


From   "Gauri Khanna" <gwkhanna@hotmail.com>
To   statalist@hsphsun2.harvard.edu
Subject   st: Von Liebig Production Function
Date   Mon, 06 Aug 2007 14:12:49 +0000

Dear Stata listers,


I am resending this message as I did not receive it the first time that I posted it.

I was wondering if any one knew whether it is possible to use a Von Liebig (VL) production function using Stata code? The VL production function is such that inputs are used in fixed proportions and the isoquants are L shaped. Hence, if one of the inputs increase, there is no corresponding increase in output.

More succintly, for two inputs, Water (W) and Nitrogen (N) the production function is described as

Y(output)=min(fn(N, n), fw(W, w))+u

where the 's are the associated parameters to be estimated.

It can be restated as

Y(output)=min(n + n.N, w + w.W, m) +u

where N amd W are applied quanitites of Nitrogen and Water with their associated parameters , and parameter m is a measure of the potential maximum yield imporsed by the scarcity of nutrients other than nitrogen and water.

For those interested, a description can be found in - Paris and Knapp, 1989,"Estimation of von Liebig Response Functions", American Journal of Agricultural Economics, pp 178-186.

The article shows that there are routines but I just wondered if it was possible in Stata.

Regards,

Gauri

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