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Abstract
The paper presents an econometric model of dynamic agricultural input demand functions that include research based technical change
and autoregressive disturbances and fits the model to annual data for a set of state aggregates pooled over 1950-1982. The methodological
approach is one of developing a theoretical foundation for a dynamic input demand system and accepting state aggreage behavior as
approximated by nonlinear adjustment costs and long-term profit maximization. Although other studies have largely ignored autocorrelation
in dynamic input demand systems, the results show shorter adjustment lags with autocorrelation than without. Dynamic input demand
own-price elasticities for the six input groups are inelastic, and the demand functions possess significant cross-price and research effects.