publication . Article . 2001

The Allen/Uzawa Elasticity of Substitution as a Measure of Gross input Substitutability

Bertoletti Paolo;
Open Access
  • Published: 01 Jan 2001 Journal: Rivista italiana degli economisti, issue 1, pages 87-94
Abstract
The Allen/Uzawa elasticity of substitution, still commonly used in the empirical studies to account for "net" substitutability, has been subject to a number of theoretical criticisms. In this paper we reconsider the Allen/Uzawa elasticity of substitution as a measure of "gross" substitutability, and show that to this relevant purpose it can be meaningfully interpreted in conjunction with the returns-to-scale properties of the technology.
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