ABSTRACT
The impact of technical change on factor demand and on production costs is important for policy makers concerned with employment and structural change. Thus, it is important that technical change be included in the specification of a production system and it is also important that technical change be measured properly. Mi specification and measurement errors may lead to biased parameter estimates and limit the use of empirical analysis to policy makers. The purpose of this paper is to explore the impact of three alternative measures of technical change on the estimated elasticities derived from cost functions.
