題組內容

 Question 1
 The following equation has becn cstimated by OLS:
612d9f3bc0650.jpg
Where Q = output, L = labor, W = wage and the figures in parentheses are standard errors. It was derived from the marginal productivity condition for labor from the CES production function 612d9f63399a8.jpg
 where K = capital stock, on the assumption that labor is paid its marginal product. From (1) obtain:

(a) estimates ofσ, where σ = 1/(I+p), the elasticity of substitution between Iabor and capital. (10 points)