Chapter

More Measures for Fixed Factors

W. M. Gorman

Edited by C. Blackorby and A. F. Shorrocks

in Separability and Aggregation

Published in print January 1996 | ISBN: 9780198285212
Published online November 2003 | e-ISBN: 9780191596322 | DOI: http://dx.doi.org/10.1093/0198285213.003.0021
 More Measures for Fixed Factors

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This paper was published in 1990 in Measurement and Modelling in Economics (ed. G. D. Myles. Amsterdam: North Holland), and in many ways is the culmination of Gorman's aggregation project, which began in 1953. The problem is cast as a capital aggregation problem, but can also be used in other contexts (labour, food). This time the aggregation question concerns the existence of a set of aggregates, where each aggregate can, in principle, depend upon all types of capital. The discussion in Sect. 1 is cast in terms of fixed factors and profit functions, and with appropriate changes can also be applied to vector social welfare, vector income measures, and so on. Sect. 2 performs the same exercise on net supply functions, Sect. 3 considers the case in which the aggregates are independent of prices, Sect. 4 presents an alternative characterization of the solution, and Sect. 5 presents an argument permitting the functions to be converted to partial derivatives; three appendices address further issues.

Keywords: aggregates; aggregation; capital aggregation; fixed factors; net supply functions; partial derivatives; profit functions; vector income measures; vector social welfare

Chapter.  11698 words.  Illustrated.

Subjects: Microeconomics

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