The Cobb-Douglas production function is given by the general formula $Q = \mathrm { AL } ^ { \alpha } \mathrm { K } ^ { \beta }$ and the constant elasticity of substitution is equal to 0 .

Question

Quizplus · Accepted Answer

The constant elasticity of substitution (CES) production function has a constant elasticity of substitution parameter, which can take on non-zero values. The Cobb-Douglas production function, as given by the formula above, does not have a CES parameter and therefore cannot have a constant elasticity of substitution of 0.

The Cobb-Douglas Production Function Is Given by the General Formula Q=ALαKβQ = \mathrm { AL } ^ { \alpha } \mathrm { K } ^ { \beta }Q=ALαKβ

The Cobb-Douglas Production Function Is Given by the General Formula $Q = \mathrm { AL } ^ { \alpha } \mathrm { K } ^ { \beta }$