Journal of Productivity Analysis

, Volume 36, Issue 1, pp 79–89 | Cite as

Elasticities of substitution and complementarity

Article

Abstract

This paper develops a classification scheme of the many different definitions of elasticities of substitution and complementarity in the production case based on primal and dual representations of technology and their related direct and inverse demand functions, gross and net substitution, elasticity type, and three different basic concepts of substitution and complementarity. The ten elasticities of substitution are derived from the cost, profit, input distance, and revenue functions. All the elasticities are equally valid for single and multi-output technologies. The classic Berndt-Wood dataset is used to show the considerable variation across the elasticities.

Keywords

Microeconomics History of economic thought Production Substitution Elasticity 

JEL Classification

B21 D12 D24 

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Copyright information

© Springer Science+Business Media, LLC 2010

Authors and Affiliations

  1. 1.Arndt-Corden Department of Economics, Crawford School of Economics and GovernmentAustralian National UniversityCanberraAustralia
  2. 2.Centre for Applied Macroeconomic AnalysisAustralian National UniversityCanberraAustralia

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