[R] Non-Linear Regression (Cobb-Douglas and C.E.S)

Mohammad Ehsanul Karim wildscop at yahoo.com
Sun Apr 18 09:28:41 CEST 2004

Dear James Wettenhall,

Your question - why do i need nonlinear regression for that model when it 
is linear after taking logs - is not a dumb question: rather it is a 
rational one. Actually C.E.S Production Function [ Y = GAMA * 
((DELTA*K^(-BETA)) + ((1-DELTA)*L^(-BETA)))^(-PHI/BETA) ] is my main 
concern (In this case there is no way to linearize it), the Cobb-Douglas 
being just a 'Toy problem' to see how non-linear process works. And i'm 
sorry that i cannot guess some approximate parameter values for that CES 
using some "typical" Y,L,K data : that why it is a problem (doing a grid 
search over infinite parameter space is indeed time consuming).

Thanks in advance for your time and effort - and sorry for my late reply.

Mohammad Ehsanul Karim <appstat at HotPOP.com>
Institute of Statistical Research and Training
University of Dhaka, Dhaka- 1000, Bangladesh

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