Market-dependent production set

Arbeitspapier

A country's production possibility frontier or PPF is defined as the boundary of its economy's production set in the net output space for a given technology and fixed quantities of primary factors of production. In general equilibrium theory, exogenous changes in technology or primary-factor supplies alter equilibrium prices; however, government-policy induced domestic relative commodity price changes do not alter the shape of an economy's production set. We show that, under international capital mobility, which is empirically significant, the shape of a country's production set does, in fact, depend on market forces and this shape can be manipulated by government policy.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: MAGKS Joint Discussion Paper Series in Economics ; No. 45-2011

Classification and Topics

• Classification: Wirtschaft ; Economic Education and Teaching of Economics: General ; General Equilibrium and Disequilibrium: General ; Macroeconomics: Production ; Neoclassical Models of Trade ; International Investment; Long-term Capital Movements
• Subject: general equilibrium ; production possibility frontier ; production set ; international capital mobility ; economic policy ; Technische Effizienz ; Allgemeines Gleichgewicht ; Kapitalmobilität ; Wirtschaftspolitik ; Theorie

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Egbert, Henrik ; Naqvi, Nadeem
• Event: Veröffentlichung
• (who): Philipps-University Marburg, Faculty of Business Administration and Economics
• (where): Marburg
• (when): 2011

Further information

• Handle: http://hdl.handle.net/10419/56594
• Last update: 10.03.2025, 11:44 AM CET