Published in:The Review of Economics and Statistics
Language:
English
ISSN:
0034-6535;
1530-9142
Origination:
Footnote:
Description:
<p>Short-term increasing returns to production factors are usually found in empirical studies. We argue they can be due to omitted variables, particularly the intensity of factor utilization. Thanks to original French firm-level data (1992-2008), we show how increasing returns to scale disappear when working time, capacity utilization rate, and, particularly, capital operating time are introduced in the production function.</p>