Production - Georgetown UniversityJan 23, 2018 . All firms minimize the cost of production and face the same input prices for capital and labor. 3. Claim: the entire economy behaves “as if” there is a single firm with technology Yt = AtF(Kt,Lt) facing the same input prices where aggregate inputs and output are. Kt = K1 t + K2 t + ···KN t and Lt = L1 t + L2 t + ···LN.aggregate production,Production function - WikipediaIn macroeconomics, aggregate production functions for whole nations are sometimes constructed. In theory they are the summation of all the production functions of individual producers; however there are methodological problems associated with aggregate production functions,.Aggregate Production Functions and Growth Economics .Abstract. Rigorous approaches to aggregation indicate that aggregate production functions do not exist except in unlikely special cases. This paper considers the awkward implications for growth economics. It provides a conventional defence of growth theory in terms of 'parables' and then considers how empirical growth.