COBB-DOUGLAS INDUSTRIAL FUNCTION AND MANAGING ECONOMIC AND TECHNOLOGICAL DEVELOPMENT
The article deals with the issue of theoretical substantiation and practical importance of industrial functions, in particular Cobb-Douglas function. It is known that lately Cobb-Douglas function is not used in practice to forecast economic development, as it describes the reality in a poor way. Whe...
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| Main Authors: | , |
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| Format: | article |
| Language: | RU |
| Published: |
Plekhanov Russian University of Economics
2018
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| Subjects: | |
| Online Access: | https://doaj.org/article/2598ecd831a04ec19f8d7c328fb714ec |
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| Summary: | The article deals with the issue of theoretical substantiation and practical importance of industrial functions, in particular Cobb-Douglas function. It is known that lately Cobb-Douglas function is not used in practice to forecast economic development, as it describes the reality in a poor way. When this function was deduced a number of methodological mistakes were made. The authors mention the use of costs and result related to different periods of time as a said mistake. Another methodological mistake, according to the authors is incorrect division of variables after finding a numerical value of power. The most serious drawback of industrial functions is the fact that they are deduced only on the basis of statistic data of the past in the absence of any explanations about the current processes in production sphere. The article runs about working out the concept aimed at resolving practical tasks of managing the development of big economic and technological systems. The development of such methods is possible only on the basis of knowledge about laws of functioning and designing economic and technological systems but not only statistic information about the past. |
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