SUBSTITUTION BETWEEN ENERGY AND NON-ENERGY INPUTS IN THE NETHERLANDS 1950-1976

The paper is limited to the substitution between factors in response to price changes without explicit consideration of the level of output. We do, however, include energy among the factors of production, and thus open the way to the introduction of non- factor inputs in the aggregate production function. The next 2 sections present the economic model which is based on the Generalized Cobb-Douglass cost function developed by Diewert (1973b). In section 4 we discuss the construction of the relevant annual aggregate data for the Dutch economy 1950-1976. Section 5 is devoted to estimation problems. In the last 2 sections we assess the validity of the model by fitting it to the data, and relate our results to the existing literature. -from Author