Cobb-Douglas Production Function. A Literature Review

For economic science, the analysis of the production function is a widespread practice, since it is approached from the microeconomic point of view with the analysis of the theory of production and also from the macroeconomic perspective to explain to what extent the changes in the factors of production determine the product. The Cobb-Douglas production function has been one of the most applied to measure these parameters, which imply productivity and economic growth at the aggregate level. So, the question arose as to whether this function is really appropriate for interpreting the sources of growth, as well as estimating the productivity of the factors and thus knowing the productive performance of a country? To address this problem, a systematic bibliographic review was carried out that historically collects the most notable contributions on this function, applied for approximately one hundred years. The main characteristics and assumptions were analyzed, as well as the strong criticisms that are made, taking into account the debate on capital-labor and the primary distribution of income. The truth is that it continues to be applied now with more sophisticated econometric models such as the unbalanced data panel of the Generalized Moment Models.

• Autor principal: Mejía-Matute, Silvia Raquel (author)
• Otros Autores: Pinos-Luzuriaga, Luis Gabriel (author), Tonon-Ordóñez, Luis Bernardo (author)
• Formato: article
• Lenguaje: spa
• Publicado: 2023
• Materias: Cobb-Douglas; Productive factors; Production function; Production; Capital productivity; Labor productivity; Factores productivos; Función de producción; Producción; Productividad del capital; Productividad del trabajo
• Acceso en línea: https://revistas.ute.edu.ec/index.php/economia-y-negocios/article/view/1124