by Qiang Gao, updated at May 20, 2017
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In Nerlove's data, output is measured in kilowatt hours. If output were measured in megawatt hours, how would the estimated restricted regression change?
In the restricted regression
if output measured in kilowatt hours (
$$ \begin{align} \log \left( \frac{ TC_i }{ p_{i3} } \right) & = \beta_1 + \beta_2 \log ( 1000 \cdot Q'i ) + \beta_3 \log \left( \frac{ p{i1} }{ p_{i3} } \right) + \beta_4 \log \left( \frac{ p_{i2} }{ p_{i3} } \right) + \varepsilon_i \ & = ( \beta_1 + \beta_2 \log (1000) ) + \beta_2 \log ( Q'i ) + \beta_3 \log \left( \frac{ p{i1} }{ p_{i3} } \right) + \beta_4 \log \left( \frac{ p_{i2} }{ p_{i3} } \right) + \varepsilon_i, \end{align} $$
then the estimated values of slopes ($$ \beta_2
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