Form of Production Function | Fixed-Proportions, Cobb-Douglas, CES | Harpreet Kaur | Ecoholics

What is production function?

Production Function, in economics, equation that expresses the relationship between the quantities of productive factors (such as labour and capital) used and the amount of product obtained.

1. Cobb-Douglas Production Function:
Cobb-Douglas production function refers to the production function in which one input can be substituted by other but to a limited extent. For example, capital and labor can be used as a substitute of each other, but to a limited extent only.

Cobb-Douglas production function can be expressed as follows:

Q = AKaLb

2. Leontief Production Function:
Leontief production function uses fixed proportion of inputs having no substitutability between them. It is regarded as the limiting case for constant elasticity of substitution.
q= min (z1/a, Z2/b)

3. CES Production Function:
CES stands for constant elasticity substitution. CES production function shows a constant change produced in the output due to change in input of production.

Q = A [aKβ + (1-a) L-β]-1/β

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