Stochastic dynamic duality: Theory and empirical applicability


Journal Article

This paper explores duality relationships for a broad class of stochastic dynamic production problems. Assuming that the decision maker maximizes the expected present value of profit, it is shown that product supply, negative factor demand, and negative quasifixed factor acquisition equations cannot be directly obtained by partial differentiation of the indirect profit function if price expectations have a Markovian structure. Consequently, empirical application of duality to many stochastic dynamic problems is quite complex and may be more difficult than a primal approach to the problem. © 1984 American Agricultural Economics Association.

Full Text

Duke Authors

Cited Authors

  • Taylor, CR

Published Date

  • January 1, 1984

Published In

Volume / Issue

  • 66 / 3

Start / End Page

  • 351 - 357

Electronic International Standard Serial Number (EISSN)

  • 1467-8276

International Standard Serial Number (ISSN)

  • 0002-9092

Digital Object Identifier (DOI)

  • 10.2307/1240802

Citation Source

  • Scopus