Most production-function studies that indicate that money doesn't matter are based on poorly specified research models.

Question

Quizplus · Accepted Answer

Many production-function studies fail to account for factors such as human capital, technology, and government policies, which can all have a significant impact on productivity. By neglecting these important variables, researchers may mistakenly conclude that money doesn't matter in terms of increasing output.

Most Production-Function Studies That Indicate That Money Doesn't Matter Are