This paper aimed to study the production behavior of the coffee production and the existing relationships in the factor markets in the States of Minas Gerais and São Paulo, during the period from 1975 to 2001. Specifically, it is evaluated the sensitiveness of the input use in response to price changes, as well as the interdependence with the production factor market. For that, the Allen elasticity of substitution approach was used. The input and labor expenditures presented the highest share of the average operational production costs in Minas Gerais and São Paulo. With respect to the substitutability/complementarity among the production factors in the Minas Gerais State, the result suggested that there was a complementarity relationship between land rent and machinery operations; land and labor; machinery and input uses, and a substitutability relationship among the other production factors. On the other hand, for the São Paulo State, it was observed that the variables land rent and labor had been complementary, and the other pairs were substitute factors.
Cost; translog; Allen elasticity of substitution; coffee
