Abstract
It has been demonstrated that the coefficients of the non-multiplicative terms of a multiplicative-logarithmic function are dependent on the units used. In addition, Dickey-Fuller tests on the multiplicative terms are unit sensitive. It is demonstrated that a simple transformation circumvents these problems. It is still true that individual coefficients of logarithmic variables in such functions are meaningless and that the Dickey-Fuller test is disturbingly arbitary. However, the transformation appears to increase the meaningfulness of a technical change trend in a translog cost function.
Original language | English |
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Pages (from-to) | 451-454 |
Number of pages | 4 |
Journal | Applied Economics |
Volume | 27 |
Issue number | 5 |
DOIs | |
Publication status | Published - 1 May 1995 |
Externally published | Yes |