Estimating production functions using inputs to control for unobservables

• 成果类型: Article
• 署名作者: Levinsohn, J; Petrin, A
• 署名单位: University of Michigan System; University of Michigan; University of Chicago
• 刊物名称: REVIEW OF ECONOMIC STUDIES
• ISSN/ISSBN: 0034-6527
• DOI: 10.1111/1467-937X.00246
• 发表日期: 2003
• 页码: 317-341
• 关键词: patterns; entry

摘要

We add to the methods for conditioning out serially correlated unobserved shocks to the production technology. We build on ideas first developed in Olley and Pakes (1996). They show how to use investment to control for correlation between input levels and the unobserved firm-specific productivity process. We show that intermediate inputs (those inputs which are typically subtracted out in a value-added production function) can also solve this simultaneity problem. We discuss some theoretical benefits of extending the proxy choice set in this direction and our empirical results suggest these benefits can be important.