THE LECHATELIER PRINCIPLE UNDER PRODUCTION UNCERTAINTY

Authors
KARAGIANNIS G GRAY R
Citation
G. Karagiannis et R. Gray, THE LECHATELIER PRINCIPLE UNDER PRODUCTION UNCERTAINTY, The Scandinavian journal of economics, 98(3), 1996, pp. 453-460
Citations number
13
Categorie Soggetti
Economics
Journal title
The Scandinavian journal of economics → ACNP
ISSN journal
03470520
Volume
98
Issue
3
Year of publication
1996
Pages
453 - 460
Database
ISI
SICI code
0347-0520(1996)98:3<453:TLPUPU>2.0.ZU;2-R
Abstract
Under production uncertainty, it is shown that the LeChatelier princip le holds for the derived demand of the ith factor if it is technically complementary (competing) with the risk-increasing (risk-reducing) qu asi-fixed input and absolute risk aversion is decreasing. In addition, the LeChatelier principle for the output supply function holds if the quasi-fixed factor is an inferior (normal) and risk-increasing (risk- reducing) input and partial risk aversion is increasing.