Econometrica: Apr 1957, Volume 25, Issue 2
Engineering Data and Statistical Techniques in the Analysis of Production and Technological Change: Fuel Requirements of the Trucking Industry
Vernon L. SmithThe relationship between the input requirements of an industry and the multi-dimensional structure of the output of the industry is shown to be derivable from the microeconomic relationship between input and output structure for individual processes. Aggregation of the process functions for the industry is achieved through knowledge of the joint frequency distribution of the output dimensions of the processes. The principles are developed in terms of the case analysis of the fuel requirements of the trucking industry. Certain fundamental relationships are shown to exist, for the truck transportation industry, between average load, average length of haul, and number of hauls on the one side, and aggregate ton-miles, vehicle-miles, and tons on the other. Analogous relationships would hold in railroad and airplane transportation.
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