微觀經(jīng)濟學(xué)（第八版-英文）課件：Production

6.1

FirmsandTheirProductionDecisions6.2

ProductionwithOneVariableInput(Labor)6.3

ProductionwithTwoVariableInputs6.4

ReturnstoScale

ProductionCHAPTEROUTLINETheProductionDecisionsofaFirmTheproductiondecisionsoffirmsareanalogoustothepurchasingdecisionsofconsumers,andcanlikewisebeunderstoodinthreesteps:ProductionTechnologyCostConstraintsInputChoices●

theoryofthefirm Explanationofhowafirmmakescost-minimizingproductiondecisionsandhowitscostvarieswithitsoutput.Inthelastthreechapters,wefocusedonthedemandsideofthe

market—thepreferencesandbehaviorofconsumers.Nowweturnto

thesupplysideandexaminethebehaviorofproducers.Wewillseehowfirmscanproduceefficientlyandhowtheircostsofproductionchangewithchangesinbothinputpricesandthelevelofoutput.WhyDoFirmsExist?FirmsandTheirProductionDecisions6.1Firmsofferameansofcoordinationthatisextremelyimportantandwouldbesorelymissingifworkersoperatedindependently.Firmseliminatetheneedforeveryworkertonegotiateeverytaskthatheorshewillperform,andbargainoverthefeesthatwillbepaidforthosetasks.Firmscanavoidthiskindofbargainingbyhavingmanagersthatdirecttheproductionofsalariedworkers—theytellworkerswhattodoandwhentodoit,andtheworkers(aswellasthemanagersthemselves)aresimplypaidaweeklyormonthlysalary.TheTechnologyofProduction●

factorsofproductionInputsintotheproductionprocess

(e.g.,labor,capital,andmaterials).Wecandivideinputsintothebroadcategoriesoflabor,materialsandcapital,eachofwhichmightincludemorenarrowsubdivisions.Laborinputsincludeskilledworkers(carpenters,engineers)andunskilledworkers(agriculturalworkers),aswellastheentrepreneurialeffortsofthefirm’smanagers.Materialsincludesteel,plastics,electricity,water,andanyothergoodsthatthefirmbuysandtransformsintofinalproducts.Capitalincludesland,buildings,machineryandotherequipment,aswellasinventories.TheShortRunversustheLongRun●

shortrun Periodoftimeinwhichquantitiesofoneormoreproductionfactorscannotbechanged.●

fixedinput Productionfactorthatcannotbevaried.●

longrun Amountoftimeneededtomakeallproductioninputsvariable.TheProductionFunction●

productionfunctionFunctionshowingthehighestoutputthatafirmcanproduceforeveryspecifiedcombinationofinputs.

(6.1)Productionfunctionsdescribewhatistechnicallyfeasiblewhenthefirmoperatesefficiently—thatis,whenthefirmuseseachcombinationofinputsaseffectivelyaspossible.ProductionwithOne

VariableInput(Labor)6.2TABLE6.1PRODUCTIONWITHONEVARIABLEINPUTAMOUNTOFLABOR(L)AMOUNTOFCAPITAL(K)TOTALOUTPUT(q)AVERAGEPRODUCT(q/L)MARGINALPRODUCT(

q/L)0100——110101010210301520310602030410802020510951915610108181371011216481011214091010812-4101010010-8Averageproductoflabor=Output/laborinput=q/LMarginalproductoflabor=Changeinoutput/changeinlaborinput=

q/LAverageandMarginalProducts●

averageproduct

Outputperunitofaparticularinput.●

marginalproduct

Additionaloutputproducedasaninputisincreasedbyoneunit.Rememberthatthemarginalproductoflabordependsontheamountofcapitalused.Ifthecapitalinputincreasedfrom10to20,themarginalproductoflabormostlikelywouldincrease.TheSlopesoftheProductCurvePRODUCTIONWITHONEVARIABLEINPUTFigure6.1(1of2)Thetotalproductcurvein(a)showstheoutputproducedfordifferentamountsoflaborinput.Theaverageandmarginalproductsin(b)canbeobtained(usingthedatainTable6.1)fromthetotalproductcurve.AtpointAin(a),themarginalproductis20becausethetangenttothetotalproductcurvehasaslopeof20.AtpointBin(a)theaverageproductoflaboris20,whichistheslopeofthelinefromtheorigintoB.TheaverageproductoflaboratpointCin(a)isgivenbytheslopeoftheline0C.20TheSlopesoftheProductCurvePRODUCTIONWITHONEVARIABLEINPUTFigure6.1(2of2)TotheleftofpointEin(b),themarginalproductisabovetheaverageproductandtheaverageisincreasing;totherightofE,themarginalproductisbelowtheaverageproductandtheaverageisdecreasing.Asaresult,Erepresentsthepointatwhichtheaverageandmarginalproductsareequal,whentheaverageproductreachesitsmaximum.AtD,whentotaloutputismaximized,theslopeofthetangenttothetotalproductcurveis0,asisthemarginalproduct.20TheAverageProductofLaborCurveIngeneral,theaverageproductoflaborisgivenbytheslopeofthelinedrawnfromtheorigintothecorrespondingpointonthetotalproductcurve.TheMarginalProductofLaborCurveIngeneral,themarginalproductoflaboratapointisgivenbytheslopeofthetotalproductatthatpoint.THERELATIONSHIPBETWEENTHEAVERAGEANDMARGINALPRODUCTSNotethegraphicalrelationshipbetweenaverageandmarginalproductsinFigure6.1(a).Whenthemarginalproductoflaborisgreaterthantheaverageproduct,theaverageproductoflaborincreases.AtC,theaverageandmarginalproductsoflaborareequal.Finally,aswemovebeyondCtowardD,themarginalproductfallsbelowtheaverageproduct.YoucancheckthattheslopeofthetangenttothetotalproductcurveatanypointbetweenCandDislowerthantheslopeofthelinefromtheorigin.THEEFFECTOFTECHNOLOGICALIMPROVEMENTFigure6.2Laborproductivity(outputperunitoflabor)canincreaseifthereareimprovementsintechnology,eventhoughanygivenproductionprocessexhibitsdiminishingreturnstolabor.AswemovefrompointAoncurveO1toBoncurveO2toConcurveO3overtime,laborproductivityincreases.TheLawofDiminishingMarginalReturns●

lawofdiminishingmarginalreturns Principlethatastheuseof

aninputincreaseswithotherinputsfixed,theresultingadditionstooutputwilleventuallydecrease.Doincreasesinhealthcareexpenditures

reflectincreasesinoutputordotheyreflect

inefficienciesintheproductionprocess?TheUnitedStatesisrelativelywealthy,anditisnaturalforconsumerpreferencestoshifttowardmorehealthcareasincomesgrow.However,itmaybethattheproductionofhealthcareintheUnitedStatesisinefficient.EXAMPLE6.1APRODUCTIONFUNCTIONFORHEALTHCAREAPRODUCTIONFUNCTIONFORHEALTHCAREFigure6.3Additionalexpendituresonhealthcare(inputs)increaselifeexpectancy(output)alongtheproductionfrontier.PointsA,B,andCrepresentpointsatwhichinputsareefficientlyutilized,althoughtherearediminishingreturnswhenmovingfromBtoC.PointDisapointofinputinefficiency.ThelawofdiminishingmarginalreturnswascentraltothethinkingofpoliticaleconomistThomasMalthus(1766–1834).Malthuspredictedthatasboththemarginalandaverageproductivityoflaborfellandthereweremoremouthstofeed,masshungerandstarvationwouldresult.Malthuswaswrong(althoughhewasrightaboutthediminishingmarginalreturnstolabor).Overthepastcentury,technologicalimprovementshavedramaticallyalteredfoodproductioninmostcountries(includingdevelopingcountries,suchasIndia).Asaresult,theaverageproductoflaborandtotalfoodoutputhaveincreased.Hungerremainsasevereprobleminsomeareas,inpartbecauseofthelowproductivityoflaborthere.EXAMPLE6.2MALTHUSANDTHEFOODCRISISTABLE6.2INDEXOFWORLDFOODPRODUCTIONPERCAPITAYEARINDEX1948-5210019611151965119197012419751251980127198513419901351995135200014420051512009155Cerealyieldshaveincreased.Theaverageworldpriceoffoodincreasedtemporarilyintheearly1970sbuthasdeclinedsince.EXAMPLE6.2MALTHUSANDTHEFOODCRISISCEREALYIELDSANDTHEWORLDPRICEOFFOODFigure6.4LaborProductivityPRODUCTIVITYANDTHESTANDARDOFLIVING●

laborproductivity Averageproductoflaborforanentireindustryorfortheeconomyasawhole.●

stockofcapital Totalamountofcapitalavailableforuseinproduction.●

technologicalchange Developmentofnewtechnologiesallowingfactorsofproductiontobeusedmoreeffectively.Consumersintheaggregatecanincreasetheirrateofconsumptioninthelongrunonlybyincreasingthetotalamounttheyproduce.Understandingthecausesofproductivitygrowthisanimportantareaofresearchineconomics.WedoknowthatoneofthemostimportantsourcesofgrowthinlaborproductivityisgrowthinthestockofcapitalWillthestandardoflivingintheUnitedStates,Europe,andJapancontinuetoimprove,orwilltheseeconomiesbarelykeepfuturegenerationsfrombeingworseoffthantheyaretoday?Becausetherealincomesofconsumersinthesecountriesincreaseonlyasfastasproductivitydoes,theanswerdependsonthelaborproductivityofworkers.EXAMPLE6.3LABORPRODUCTIVITYAND

THESTANDARDOFLIVINGTABLE6.3LABORPRODUCTIVITYINDEVELOPEDCOUNTRIESUNITEDSTATESJAPANFRANCEGERMANYUNITEDKINGDOMGDPPERHOURWORKED(IN2009USDOLLARS)$56.90$38.20$54.70$53.10$45.80YearsAnnualRateofGrowthofLaborProductivity(%)1960-19732.297.864.703.982.841974-19820.222.291.732.281.531983-19911.542.641.502.071.571992-20001.941.081.401.642.222001-20091.901.500.900.801.30IsoquantsProductionwithTwoVariableInputs6.3●

isoquants Curveshowingallpossiblecombinationsofinputsthatyieldthesameoutput.TABLE6.4PRODUCTIONWITHTWOVARIABLEINPUTSLABOR

INPUTCAPITALINPUT12345120405565752406075859035575901001054658510011011557590105115120●

isoquantmapGraphcombininganumberofisoquants,usedtodescribeaproductionfunction.ISOQUANTMAPSPRODUCTIONWITHTWOVARIABLEINPUTSFigure6.5Asetofisoquants,orisoquantmap,describesthefirm’sproductionfunction.Outputincreasesaswemovefromisoquantq1(atwhich55unitsperyearareproducedatpointssuchasAandD),toisoquantq2(75unitsperyearatpointssuchasB),andtoisoquantq3(90unitsperyearatpointssuchasCandE).Bydrawingahorizontallineataparticularlevelofcapital—say3,wecanobservediminishingmarginalreturns.Readingthelevelsofoutputfromeachisoquantaslaborisincreased,wenotethateachadditionalunitoflaborgenerateslessandlessadditionaloutput.InputFlexibilityIsoquantsshowtheflexibilitythatfirmshavewhenmakingproductiondecisions:Theycanusuallyobtainaparticularoutputbysubstitutingoneinputforanother.Itisimportantformanagerstounderstandthenatureofthisflexibility.DiminishingMarginalReturnsEventhoughbothlaborandcapitalarevariableinthelongrun,itisusefulforafirmthatischoosingtheoptimalmixofinputstoaskwhathappenstooutputaseachinputisincreased,withtheotherinputheldfixed.Becauseaddingonefactorwhileholdingtheotherfactorconstanteventuallyleadstolowerandlowerincrementaloutput,theisoquantmustbecomesteeperasmorecapitalisaddedinplaceoflaborandflatterwhenlaborisaddedinplaceofcapital.Therearealsodiminishingmarginalreturnstocapital.Withlaborfixed,themarginalproductofcapitaldecreasesascapitalisincreased.SubstitutionAmongInputsDIMINISHINGMRTS

●

marginalrateoftechnicalsubstitution(MRTS) Amountby

whichthequantityofoneinputcanbereducedwhenoneextraunitofanotherinputisused,sothatoutputremainsconstant.

Becausewearekeepingoutputconstantbymovingalonganisoquant,thetotalchangeinoutputmustbezero.Thus,

Now,byrearrangingtermsweseethat

(6.2)

MARGINALRATEOFTECHNICALSUBSTITUTIONFigure6.6Likeindifferencecurves,isoquantsaredownwardslopingandconvex.Theslopeoftheisoquantatanypointmeasuresthemarginalrateoftechnicalsubstitution—theabilityofthefirmtoreplacecapitalwithlaborwhilemaintainingthesamelevelofoutput.Onisoquantq2,theMRTSfallsfrom2to1to2/3to1/3.ProductionFunctions—TwoSpecialCasesTwoextremecasesofproductionfunctionsshowthepossiblerangeof

inputsubstitutionintheproductionprocess:thecaseofperfectsubstitutesandthefixedproportionsproductionfunction,sometimescalledaLeonitiefproductionfunction.●

fixed-proportionsproductionfunction ProductionfunctionwithL-shapedisoquants,sothatonlyonecombinationoflaborandcapitalcanbeusedtoproduceeachlevelofoutput.Thefixed-proportionsproductionfunctiondescribessituationsinwhichmethodsofproductionarelimited.ISOQUANTSWHENINPUTSAREPERFECTSUBSTITUTESFigure6.7Whentheisoquantsarestraightlines,theMRTSisconstant.Thustherateatwhichcapitalandlaborcanbesubstitutedforeachotheristhesamenomatterwhatlevelofinputsisbeingused.PointsA,B,andCrepresentthreedifferentcapital-laborcombinationsthatgeneratethesameoutputq3.FIXED-PROPORTIONSPRODUCTIONFUNCTIONFigure6.8WhentheisoquantsareL-shaped,onlyonecombinationoflaborandcapitalcanbeusedtoproduceagivenoutput(asatpointAonisoquantq1,pointBonisoquantq2,andpointConisoquantq3).Addingmorelaboralonedoesnotincreaseoutput,nordoesaddingmorecapitalalone.FoodgrownonlargefarmsintheUnitedStatesis

usuallyproducedwithacapital-intensive

technology.However,foodcanalsobeproduced

usingverylittlecapital(ahoe)andalotoflabor

(severalpeoplewiththepatienceandstaminato

workthesoil).MostfarmsintheUnitedStatesandCanada,

wherelaborisrelativelyexpensive,operateinthe

rangeofproductioninwhichtheMRTSisrelatively

high(withahighcapital-to-laborratio),whereasfarmsindevelopingcountries,inwhichlaborischeap,operatewithalowerMRTS(andalowercapital-to-laborratio).Theexactlabor/capitalcombinationtousedependsoninputprices,asubjectthatwediscussinChapter7.EXAMPLE6.4APRODUCTIONFUNCTIONFORWHEATEXAMPLE6.4APRODUCTIONFUNCTIONFORWHEATISOQUANTDESCRIBINGTHEPRODUCTIONOFWHEATFigure6.9Awheatoutputof13,800bushelsperyearcanbeproducedwithdifferentcombinationsoflaborandcapital.Themorecapital-intensiveproductionprocessisshownaspointA,themorelabor-intensiveprocessaspointB.ThemarginalrateoftechnicalsubstitutionbetweenAandBis10/260=0.04.ReturnstoScale6.4●

returnstoscaleRateatwhichoutputincreasesasinputsareincreasedproportionately.●

increasingreturnstoscaleSituationinwhichoutputmorethandoubleswhenallinputsaredoubled.●

constantreturnstoscaleSituationinwhichoutputdoubleswhenallinputsaredoubled.●

decreasingreturnstoscaleSituationinwhichoutputlessthandoubleswhenallinputsaredoubled.INCREASINGRETURNSTOSCALECONSTANTRETURNSTOSCALEDECREASINGRETURNSTOSCALERETURNSTOSCALEFigure6.10Whenafirm’sproductionprocessexhibitsconstantreturnstoscaleasshownbyamovementalongline0Ainpart(a),theisoquantsareequallyspacedasoutputincreasesproportionally.However,whenthereareincreasingreturnstoscaleasshownin(b),theisoquants