First, child and adult labor are perfect substitutes subject to a productivity shifter ("the substitution axiom" in Basu and Van 1998).
Notice that: ρ i Case Elasticity of substitution −∞ Leontieff: perfect complements 0 0 Cobb Douglas 1 1 Perfect substitutes ∞.
Ottaviano and Peri (2012) show that workers with less than 12 years of education and high school graduates are perfect substitutes, workers with some college and college graduates have a high elasticity of substitution, and there is a very low elasticity of substitution between all workers with 12 or fewer years of education versus all workers with 13 or more years of education.
@judy_chevalier So not perfect substitutes!
So as far as the consumers are concerned, these two products are perfect substitutes.
"That said, hawalas are even less perfect substitutes for banks," he said.
All of those characteristics make them as perfect substitutes for traditional desiccant liquids.
The demand curve for copies of a given book is, we assume, negatively sloped because there are good but not perfect substitutes for a given book.
First, for many types of intellectual property some price discrimination may be possible because individual works are not perfect substitutes and arbitrage is preventable.
Smartphones and tablets, while not perfect substitutes for PCs, are pulling dollars out of consumers' wallets that might have otherwise gone to laptop or desktop computers.
Although the euro will eliminate intra-European exchange-rate risk, it does not mean that German and Italian bonds become perfect substitutes.
