Trigonometric Cost Function I've been reading on producer theory and came up with a ridiculous question. Has anyone tried to model costs with a trigonometric function? would it work with the assumptions we need? Thanks!
There is a long tradition of using flexible functional forms for cost, utility or production functions. This can be done using a (low) order series expansion. Usually, these are Taylor expansions. For example the translog is a second order polynomial in log prices.
Of course, one could also use a Fourier expansion, which would give a function in terms of cosine and sine functions.
See for example the appendix of Griffin, Montgomery, Rister,(1987) &quot;Selecting Functional Form In Production Function Analysis,&quot; Western Journal of Agricultural Economics