The State-Contingent Properties of Stochastic Production Functions

Robert Chambers, J. Quiggin

    Research output: Contribution to journalArticle

    19 Citations (Scopus)

    Abstract

    The state-contingent properties of the most frequently used representations of stochastic production in the agricultural-economics literature are examined. Particular attention is paid to the cases of multiplicative uncertainty, additive uncertainty, and the Just-Pope production function, State-contingent technologies and their associated cost functions are reviewed, and that theory is applied to the stochastic production function. A generalization of the Just-Pope technology that has desirable state-contingent characteristics is proposed. Cost functions based upon state-contingent technologies are compared with cost functions based on a parametrized distribution representation of production uncertainty.
    Original languageEnglish
    Pages (from-to)513-526
    JournalAmerican Journal of Agricultural Economics
    Volume84
    Issue number2
    DOIs
    Publication statusPublished - 2002

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