---
title: "Estimating Production Functions of Multiproduct Firms"
authors:
  - name: "Valmari, Nelli"
date_published: "2016-03-08"
series: "ETLA Working Papers"
series_number: "37"
issn:
  - "2323-2420"
  - "2323-2439"
jel_codes:
  - "D24"
  - "L11"
  - "L25"
language: "en"
publisher: "ETLA Economic Research"
pdf_url: "https://www.etla.fi/wp-content/uploads/ETLA-Working-Papers-37.pdf"
keywords:
  - "Multiproduct firm"
  - "production function"
  - "productivity"
identifier: "https://www.etla.fi/julkaisut/id/ETLA-Working-Papers-37"
---

# Estimating Production Functions of Multiproduct Firms

**Published:** 2016-03-31  
**Categories:** Publications, Working Papers  
**URL:** https://www.etla.fi/en/publications/estimating-production-functions-of-multiproduct-firms/

Despite the fact that multiproduct firms constitute a considerable share of firms and account for an even greater share of production, virtually all production function estimates are based on the assumption that firms are single-product producers. The single-product assumption is made due to lack of data on input allocation across the various product lines multiproduct firms operate. I provide a method to estimate product-level production functions without observable input allocations. The empirical application and Monte Carlo simulations show that the single-product firm assumption leads to biased parameter and productivity estimates and overestimated productivity differences between firms.

---

## Additional Information

**Kirjoittajat:** Valmari, Nelli

**Kansikuva:** https://www.etla.fi/wp-content/uploads/ETLA-Working-Papers-37_kansi.jpg

**Lataa Pdf:** https://www.etla.fi/wp-content/uploads/ETLA-Working-Papers-37.pdf

**Key Words:** Multiproduct firm, production function, productivity

**Jel:** D24, L11, L25

**Paivays:** 08.03.2016

**Sivuja:** 61

15

**Kieli:** en

**Sarja:** ETLA Working Papers

**Sarja Nro:** 37

**Issn:** 2323-2420, 2323-2439

**Saatavuus:** 1

**Publication Research:** No

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