Title: Nonparametric production function estimation with shape constraints
Authors: Yining Chen - London School of Economics and Political Science (United Kingdom) [presenting]
Abstract: A new approach is developed to estimate a production function based on the economic axioms of the Regular Ultra Passum (RUP) law and convex non-homothetic input isoquants. Central to the development of our estimator is stating the axioms as shape constraints and using shape constrained nonparametric regression methods. Under regularity conditions, we show the consistency of our estimator. Algorithms are also developed to facilitate the computation of the estimator. Finally, we implement this approach using data from the Japanese corrugated cardboard industry.