A production function study of manufacturing establishments of France, India, Israel Japan and Yugoslavia

Abstract

This thesis is an empirical inquiry into the nature of production functions of manufacturing establishments of France, India, Israel Japan and Yugoslavia. It uses the difference between the nature of economic and technical variables to review several forms of production functions in the literature. Fifteen production relations are selected for a cross section analysis of the data of each country. Various criteria of grouping the establishment data are examined. It is found that meaningful results can be obtained from mixed establishment data which can represent the manufacturing sector of a country. It is found that in international comparisons based on production function analysis, nations are more relevant than industries or groups of manufacturing establishments. The intrinsic features of the data are best revealed when the production relation contains at least one suitable economic and one suitable technical variable on the explanatory side. By grouping the data according to various criteria and applying statistical tests, it is shown that there is homogeneity between groups of establishments within each country and that this homogeneity is revealed in almost all cases when the grouping of the data is based on a variable which is not a dependent variable in the production relation used in the analysis.