Analysis with the Constant Elasticity of Substitution (CES) Function
Calculate CES function
Methods for Estimated CES Functions
Estimate a CES function
Durbin Watson Test for Estimated CES Functions
Aggregated Time Series Data for the West German Industry
Mishra's (2006) CES data
Plot RSSs of a CES Function Estimated by Grid Search
Summarize Estimation of a CES Function
Tools for econometric analysis and economic modelling with the traditional two-input Constant Elasticity of Substitution (CES) function and with nested CES functions with three and four inputs. The econometric estimation can be done by the Kmenta approximation, or non-linear least-squares using various gradient-based or global optimisation algorithms. Some of these algorithms can constrain the parameters to certain ranges, e.g. economically meaningful values. Furthermore, the non-linear least-squares estimation can be combined with a grid-search for the rho-parameter(s). The estimation methods are described in Henningsen et al. (2021) <doi:10.4337/9781788976480.00030>.