Summer Course: Introduction to Econometric Production Analysis ...

• critically evaluate the appropriateness of a specific econometric production analysis or
efficiency analysis for analysing a specific real-world question.
Course Prerequisites
The participants are expected to have a basic knowledge of microeconomic production theory
(e.g. technology set, production function, isoquant, cost function, marginal product, partial
output elasticity, elasticity of scale, marginal rate of technical substitution, elasticity of
substitution), econometrics (e.g. ordinary least squares, hypothesis tests), and mathematics
(e.g. logarithms, partial derivatives). Furthermore, some experience with econometric software
(particularly R) is helpful. Students who are lacking knowledge in some of these topics are
encouraged to fill their knowledge gaps before the course.
Students should bring a laptop computer with R (http://www.r-project.org) and RStudio
(http://www.rstudio.org) installed to the course.
Course Schedule
Monday morning
• welcome
• introduction to the course
• brush-up: production functions and their properties
• preparing data for econometric production analysis
• introduction of the main data set used in the course
• brief introduction to R and RStudio
• calculation of variables needed for the analysis
Monday afternoon
• partial productivities
• total factor productivities
• linear production function
– specification
– estimation
– observed and predicted output quantities
– marginal products
– partial output elasticities
– elasticities of scale
– optimal firm size
– consistency with microeconomic theory
– marginal rates of technical substitution
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