Simple nonparametric tests of technological change: Theory and application to U.S. agriculture

Several nonparametric tests of technological change are proposed conditional on alternative maintained behavioral assumptions. The tests are simple as they require verification of axioms via binary comparisons that are analogous to those of the revealed preference theory. Our model allows a broad interpretation of technological changes, yet trivial rationalization of the data with either profit-maximization or cost-minimization behavior is excluded. The tests are applied to study the U.S. aggregate agricultural data, supporting the hypotheses of rankable and neutral Technological Variations.