1. Education Production Function
A model

2. Theory Output= f(inputs) What is output? Test scores?
Which scores?
Graduation rates?
Multiple outputs?
Estimation

3. Theory Output= f(inputs) What are the inputs?
Think of (pure or general) theory
Capital, labor (human capital), energy, materials
Think of literature (you have been reading the literature, right?)
student teacher ratio
teacher salaries
per pupil expenditures
socio-demographic characteristics
other

4. Theory Output = f(inputs) What is f(.)? Linear non-linear
no interactions
interactions

5. Estimation Multiple outputs separate regressions
Seemingly unrelated regressions
cross equation restrictions

6. Estimation - SUR

7. Estimation - SUR Cross equation constraints F(y, z; x1, x2)
PPF
MRTSy = MRTSx
implication