Econometrica: Mar 1970, Volume 38, Issue 2

Estimating Cost Function Parameters Without Using Cost Data: Illustrated Methodology<256:ECFPWU>2.0.CO;2-M
p. 256-275

James N. Rosse

A study of daily newspaper cost behavior is used to illustrate a method of estimating cost function parameters using cross-section output and price data only. The cost parameter estimates are obtained by simultaneously estimating demand functions and equations characterizing necessary conditions for profit maximization.

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