Employing this model over small farms shows that nonessential factors may yield a positive product.
Australian economist P. J. Lloyd has argued that the basis of this idea can be found in the work The Isolated State, while John Stuart Mill explained his theory of comparative advantage using a system of equations that imply it . When applied to utility, it implies that all own price elasticities are negative one and all cross price elasticities are zero. Employing this model over small farms shows that nonessential factors may yield a positive product. One problem with this model is that applying statistical data to it sometimes suggests that the demand for labor is greater than 1. First proposed by Knut Wicksell, it implies constant returns to scale, and its namesakes also estimated that the share of labor and capital stays constant over time. For 10 points, identify this model which includes parameters for output elasticity as a function of technology, a doubly eponymous production function.
Australian economist P. J. Lloyd has argued that the basis of this idea can be found in the work
Cobb-Douglas Production Function