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| Alberto Behar |
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| ''Marshall`s Rules with Aggregate Inputs'' |
| ( 2011, Vol. 31 No.1 ) |
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| We establish the formal link between the separability of inputs in a production function and the aggregate elasticity of demand for those inputs. This validates the implicit assumption used when calculating an aggregate elasticity with aggregated input prices and provides a
practical approach to calculating an aggregate elasticity when one has disaggregated prices. We illustrate the approach to add to a thin empirical literature on labor demand elasticities in developing countries by using South African data. |
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| Keywords: Elasticity of substitution, labor demand, separability |
JEL: J2 - Demand and Supply of Labor: General
J3 - Wages, Compensation, and Labor Costs: General |
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| Manuscript Received : Mar 01 2011 | | Manuscript Accepted : Mar 14 2011 |
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