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Abstract
Suppose that the production, y = f (x1, x2,..., xs ) , is known. It says
that we are able to know for each value of the input vector, 1 2 , ,..., s x x x , the
correspondent value of y. Or yet production growth occurs as consequence of movement
along the production frontier, and it requires a different combination of inputs, and consequently, a higher or a smaller expenditure. Another representation of the production structure is, 1 2 ( , ,..., , ) s y = f x x x t , where t is non negative real number. Now each set of 1 2 , ,..., s x x x gives a different y as t varies. Or, it is possible to achieve a higher level of production with no additional cost. A question comes to mind: can the real
world (or the data) say which one of the two representations has a better descriptive
power? The answer is no. Or yet, the real world cannot distinguish between embodied
and disembodied technology in a sense that will be introduced below. We will not use
directly the concept of production function to establish the model appropriate to test
embodied technology against the disembodied one. In its place, the rates of growth of
products and inputs are instrumental.