Recently Chambers and Färe (1998) [Chambers, R.G., Färe, R., 1998. Translation homotheticity. Economic Theory 11, 629-641] generalized the Shephard type of "multiplicative" homotheticity into an "additive" type, which they termed translation homotheticity. This type of homotheticity has parallel expansion paths and its cost function is additively separable. In this letter a nonparametric test for translation homotheticity is developed.
Scopus Subject Areas
- Economics and Econometrics