Introduction

Abstract

The traditional theory of the firm which serves as the underpinnings of what we know as neoclassical production theory, has proved to be a useful benchmark model. The implied behavioral goals of profit maximization, revenue maximization and cost minimization are useful in understanding choices made at the firm and industry level, as well as serving as quite powerful models for empirical analysis. Duality theory has enriched the use of cost, revenue and profit functions by providing a means of retrieving information on underlying technology from functions which are better suited to econometric estimation than production functions, for example. These alternative ‘dual’ representations of technology also provide those pursuing applied work with choices with respect to data requirements.