Journal of Productivity Analysis

, Volume 19, Issue 1, pp 5–32 | Cite as

Nonparametric Dynamic Production Analysis and the Theory of Cost

  • Elvira Silva
  • Spiro E. Stefanou

Abstract

While the dynamic theory of production provides little insight towards identifying a specific functional form for the firm's technology, dynamic production analysis has been explored traditionally in a parametric framework. A nonparametric dynamic dual cost approach to production analysis is developed in this article. Recovering technological information from intertemporal cost minimizing behavior is possible without imposing a parametric functional form on the firm's technology. Nonparametric tests to analyze the structure of a dynamic technology are presented from a dynamic cost minimizing perspective. The empirical implementation of these tests is illustrated for a balanced panel data set of Pennsylvania dairy operators during the time period 1986–1992.

dynamic cost approach nonparametric production analysis 

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Copyright information

© Kluwer Academic Publishers 2003

Authors and Affiliations

  • Elvira Silva
    • 1
  • Spiro E. Stefanou
    • 2
  1. 1.Faculty of Economics of PortoUniversity of Porto, Research Center on Labor and Firm Economics (CETE)PortoPortugal
  2. 2.Department of Agricultural Economics and Rural SociologyThe Pennsylvania State UniversityUniversity Park

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