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Description:
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Recently , economic analysis based on empirical evidence from estimates of production functions pertaining to the U .S . manufacturing sector has gained considerable momentum . Research in this area has passed through two main stages of development . The first began with the publication of the pioneering work by Cobb and Douglas in 1928 and ended in 1961 . During this period , estimates of production functions in U .S . manufacturing industries were of the following three types : (1 ) for manufacturing as a whole fitted to time -series data ; (2 ) for manufacturing as a whole fitted to cross -section data for the individual industries for the same year ; and (3 ) for manufacturing as a whole fitted to data across the states (the individual state being the unit of observation ) for the same year . During this period a limited number of investigations was conducted within this framework of empirical research . This is attributed to the lack of sufficiently disaggregated data for value added , labor and capital inputs . Data for estimation purposes was not available for individual establishments in the manufacturing sector but was aggregated by industry . |