چکیده:
In this study, in order to examine the structure of foreign trade, two basic hypotheses regarding the existence of a substitution relationship between imports and capital services and between imports and labor have been tested. To test the above hypotheses, a translog cost function was used, which is two-input (consumer and capital goods) and three-input (labor, capital, and imports), adding imports as a factor of production to the production factors of labor and capital; then, based on the iterative three-stage least squares method, the cost share and income equations, Allen-Uzawa substitution elasticities, and price elasticities of demand for factors of production were estimated.
خلاصه ماشینی:
To test the above hypotheses, a two-output (consumer and capital goods), three-input (labor, capital, and imports) translog cost function has been used, which adds imports as a production factor to the production factors of labor and capital; then, based on the iterative three-stage least squares method and the estimation of cost share and income equations, Allen-Uzawa substitution elasticities and price elasticities of demand for production factors have been estimated.
Unlike the conventional method 1P} that obtains the import demand function based on utility or production theory and imposes the separability hypothesis as an imposed assumption on the model, Berges (1974), based on the cost function, the developed pattern of Christensen, Jorgenson, and Liu (1973) for three inputs and two outputs, estimated the import demand equation simultaneously with the demand equations for labor and capital by applying the conditions of symmetry and homogeneity.
The results of Table (3) show that the calculated substitution elasticities are numerically small values and the two factors of labor and capital are weak substitutes for imports; this result can be interpreted as follows: if the price of imports increases, production units have little inclination to substitute labor and capital in order to remain at their previous production level.
The translog cost function used was estimated based on the iterative three-stage least squares method, and the results from the calculations related to substitution elasticities show that imports have a substitution relationship with other production factors, but numerically they have small values.
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