| Abstract: | A translog cost function was used to obtain estimates of the own- and cross-price demand elasticities for nitrogen, phosphorus and potassium. The results indicated a mean value for the own-elasticities of —1.0, —0.6, —0.5 for N, P and K respectively. A test of the hypothesis of nutrient substitution was attempted. The test indicated that P and K were substitutable for N but not for each other. This result was corroborated by a zero elasticity of substitution estimate between phosphorous and potassium. A corollary of the results was the rejection on empirical grounds of the Cobb-Douglas specification for the input demand functions. The latter function has traditionally been used in analyses of this nature. |
