Economic Analysis of Limitation Laws

Abstract

Let us consider a variation within the reduced factor diagram (v ₁, ..., v _n ) with v _n +1,..., v _n as shadow factors. When we speak of a partial variation we mean — as in the case of (12j.2) and (12j.3) — a partial variation within the reduced factor diagram, with the shadow factors always following. Let q ₁ ..., q _n , q _n+1, ..., q _N be the factor prices. We shall call the cost of the basis factors, that is to say, those on which the reduced product function depends:

$$The{\kern 1pt} reduced{\kern 1pt} \cos t = {q_{1}}{v_{1}} + \ldots + {q_{n}}{v_{n}} = \sum\limits_{{i = 1}}^{n} {{q_{i}}{v_{{_{i}}}}} \left[ {cf.(10a.1)} \right] $$

((13a.1))

By contrast we have

$$The{\kern 1pt} reduced{\kern 1pt} \cos t = b = {q_{1}}{v_{1}} + \ldots + {q_{n}}{v_{n}} + {q_{n}} + {}_{1}{v_{n}} + 1 + \ldots + {q_{N}}{v_{N}} = \sum\limits_{{i = 1}}^{n} {{q_{i}}{v_{{_{i}}}}} $$

((13a.2))

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