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Last data update: 2014.03.03

R: Elasticities of a translog Function

translogEla

R Documentation

Elasticities of a translog Function

Description

Calculate the elasticities of a translog function.

Usage

translogEla( xNames, data, coef, coefCov = NULL,
   dataLogged = FALSE  )

## S3 method for class 'translogEst'
elas( object, data = NULL, dataLogged = NULL,
   ... )

Arguments

`xNames`	a vector of strings containing the names of the independent variables.
`data`	dataframe containing the data; if argument `data` of `elas.translogEst` is not specified, the data frame that was used for the estimation is used for calculating elasticities.
`coef`	vector containing all coefficients: if there are `n` exogenous variables in `xNames`, the `n+1` alpha coefficients must have names `a_0`, ..., `a_n` and the `n*(n+1)/2` beta coefficients must have names `b_1_1`, ..., `b_1_n`, ..., `b_n_n` (only the elements of the upper right triangle of the beta matrix are directly obtained from `coef`; the elements of the lower left triangle are obtained by assuming symmetry of the beta matrix).
`coefCov`	optional covariance matrix of the coefficients: the row names and column names must be the same as the names of `coef`.
`dataLogged`	logical. Are the values in `data` already logged? If argument `dataLogged` of `elas.translogEst` is not specified, the same value as used in `translogEst` for creating `object` is used.
`object`	object of class `translogEst` (returned by `translogEst`).
`...`	currently ignored.

Details

Shifter variables do not need to be specified, because they have no effect on the elasticities. Hence, you can use this function to calculate elasticities even for translog functions that have been estimated with shifter variables.

Value

A data frame containing the elasticities, where each column corresponds to one of the independent variables. If argument coefCov is provided, it has the attributes variance and stdDev, which are two data frames containing the variances and the standard deviations, respectively, of the elasticities.

Author(s)

Arne Henningsen

Examples

   data( germanFarms )
   # output quantity:
   germanFarms$qOutput <- germanFarms$vOutput / germanFarms$pOutput
   # quantity of variable inputs
   germanFarms$qVarInput <- germanFarms$vVarInput / germanFarms$pVarInput
   # a time trend to account for technical progress:
   germanFarms$time <- c(1:20)

   # estimate a quadratic production function
   estResult <- translogEst( "qOutput", c( "qLabor", "land", "qVarInput", "time" ),
      germanFarms )

   # calculate production elasticities of all inputs
   estEla <- translogEla( c( "qLabor", "land", "qVarInput", "time" ), 
      data = germanFarms, coef = coef( estResult ), 
      coefCov = vcov( estResult ) )
   # all elasticities
   estEla
   # t-values of all elasticities
   estEla / attributes( estEla )$stdDev