| Abstract: | Summary In this paper we present dynamic factor demand functions for labour and capital, and the underlying production function for the Austrian economy. Our approach is neoclassical. By definition, the production function is of the Cobb-Douglas type; experiments with a CES production function were not successful. Our empirical results look very plausible. The adjustement speeds, the output and price elasticities of both factor demand functions, as well as the parameters of the underlying production function are of a order of magnitude highly compatible with neoclassical theory. |
