EFFECTS OF ALLOCATIVE INEFFICIENCY ON INPUT SUBSTITUTION IN IRAN'S MANUFACTURING SECTOR

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SADEGHI HOSSEIN; FEROUZAN SARNAGHI TOUHID

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Journal: JOURNAL OF SUSTAINABLE GROWTH AND DEVELOPMENT (THE ECONOMIC RESEARCH) Year:2010 | Volume:10 | Issue:1 Page(s): 71-98

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Title

EFFECTS OF ALLOCATIVE INEFFICIENCY ON INPUT SUBSTITUTION IN IRAN'S MANUFACTURING SECTOR

Author(s)

SADEGHI HOSSEIN | FEROUZAN SARNAGHI TOUHID | Issue Writer Certificate

Keywords

PRICE DISTORTIONQ3

ALLOCATIVE INEFFICIENCYQ3

SHADOW COST FUNCTIONQ2

INPUT MARKETSQ3

MANUFACTURING SECTORQ2

Abstract

According to the neoclassical approach, input prices as a measure of resources scarcity induce firms to cost-minimizing and efficient allocation of recourses. But when the prices are distorted, the effective competitive inputs are used inefficiently and have resulted in under- or over-utilization of production factors relative to their endowments or ALLOCATIVE INEFFICIENCY.In this paper, the shadow cost approach and system of equations are used to estimate ALLOCATIVE INEFFICIENCY using the Iran's manufacturing data over the period 1976-2006. The results show that there is strong ALLOCATIVE INEFFICIENCY and increasing cost of production of firms in Iran's MANUFACTURING SECTOR.

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APA: Copy

SADEGHI, HOSSEIN, & FEROUZAN SARNAGHI, TOUHID. (2010). EFFECTS OF ALLOCATIVE INEFFICIENCY ON INPUT SUBSTITUTION IN IRAN'S MANUFACTURING SECTOR. JOURNAL OF SUSTAINABLE GROWTH AND DEVELOPMENT (THE ECONOMIC RESEARCH), 10(1), 71-98. SID. https://sid.ir/paper/86467/en

Vancouver: Copy

SADEGHI HOSSEIN, FEROUZAN SARNAGHI TOUHID. EFFECTS OF ALLOCATIVE INEFFICIENCY ON INPUT SUBSTITUTION IN IRAN'S MANUFACTURING SECTOR. JOURNAL OF SUSTAINABLE GROWTH AND DEVELOPMENT (THE ECONOMIC RESEARCH)[Internet]. 2010;10(1):71-98. Available from: https://sid.ir/paper/86467/en

IEEE: Copy

HOSSEIN SADEGHI, and TOUHID FEROUZAN SARNAGHI, “EFFECTS OF ALLOCATIVE INEFFICIENCY ON INPUT SUBSTITUTION IN IRAN'S MANUFACTURING SECTOR,” JOURNAL OF SUSTAINABLE GROWTH AND DEVELOPMENT (THE ECONOMIC RESEARCH), vol. 10, no. 1, pp. 71–98, 2010, [Online]. Available: https://sid.ir/paper/86467/en

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