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What is Concavity of Cobb-Douglas Function Proof about?

1) The Cobb-Douglas production function F(x1, ..., xn) is concave if the sum of the exponents αi is less than or equal to 1. 2) This can be proven by showing that F is homogeneous of degree k, where k is the sum of the exponents, and quasi-concave. Using theorems about homogeneous and quasi-concave functions, F can be shown to be concave when k ≤ 1. 3) If the sum of the exponents exceeds 1, F is neither concave nor convex.

Author

parapara11

Language

EN