Comment on “Olley and Pakes‐style Production Function Estimators with Firm Fixed Effects”

B-Tier
Journal: Oxford Bulletin of Economics and Statistics
Year: 2021
Volume: 83
Issue: 3
Pages: 836-840

Score contribution per author:

2.011 = (α=2.01 / 1 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

In this comment I illustrate that in the model of (Lee et al. (2019). Oxford Bulletin of Economics and Statistics. Vol. 81, pp. 80–97), firm profit maximizing implies that Assumption 2 and Equation 14 may be contradictory. More specifically, there is generally a contradiction when investment is used as the control variable, but there is generally not a contradiction when a static input like material input is used as the control variable (both types of control variables are discussed in Lee et al.). While the Lee et al. model and techniques are an interesting way to incorporate fixed effects into Olley and Pakes‐style production function estimators, this observation suggests that their application should be restricted to cases where static inputs are used as control variables.

Technical Details

RePEc Handle
repec:bla:obuest:v:83:y:2021:i:3:p:836-840
Journal Field
General
Author Count
1
Added to Database
2026-01-24