ABSTRACT
This chapter examines preliminary aspects of long-period duality in the simple case of an individual, isolated industry. The crucial point is that this industry makes net profit of zero. This is a simple case of what Ian Steedman and the author calls a full industry equilibrium (FIE). The chapter deals with an industry characterized by u-shaped average cost curves and two primary inputs, land and labour. It discusses the strict constant returns to scale and introduce a third input, consisting of the industry's own output. In both cases it is found that, in FIE, the degrees of freedom on the production function/isoquant are sharply reduced and the true production function/isoquant may not be implicit in the knowledge of long-period prices. The chapter explains the polar case of infinitely many techniques, the knowledge of the entire FIE frontier would determine much of the true isoquant, as the interested reader can easily see on the basis of standard duality-theory arguments.
