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2018 | 101 | 145-156
Article title

Application of Cobb-Douglas Production Function to Manufacturing Industries in West Sumatra Indonesia

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In this paper, we discusses one of the production functions that shows the relationship between the level of output and the level of input combinations that called Cobb-Douglas production function. The estimation method used is the least square estimation with the settlement using Newton Raphson iteration. The Cobb-Douglas production function is applied to five selected manufacturing industries in West Sumatra. From the research result, the return to scale (RTS) of the rubber and plastic goods industry is 0.8424 and the return to scale of the food and beverage industry is 0.8496 in which the two industries produce RTS <1. Whereas return to scale of the publishing and printing industry is 1.0460, the return to scale of the textile industry is 1.0018, and the return to scale of the non-metallic mining industry is 1.3384. Of the three industries each produce RTS> 1.
Physical description
  • Master Program in Mathematics, Faculty of Mathematics and Natural Sciences, Universitas Padjadjaran, Indonesia
  • Department of Mathematics, Faculty of Science and Technology, Universitas Islam Negeri Sunan Gunung Djati Bandung, Indonesia
  • Department of Mathematics, Faculty of Science and Technology, Universitas Islam Negeri Sunan Gunung Djati Bandung, Indonesia
  • Department of Mathematics, Faculty of Mathematics and Natural Science, Universitas Padjadjaran, Indonesia
  • Department of Marine Science, Faculty of Fishery and Marine Science, Universitas Padjadjaran, Indonesia
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