Capital-labor substitution and economic efficiency
TL;DR: In this article, the authors proposed a method to improve the quality of the service provided by the service provider by using the information of the user's interaction with the provider and the provider.
Abstract: Обсуждаются следующие темы: чистая теория производства, функциональное распределение дохода, технический прогресс, источники международных конкурентных преимуществ. Анализируются эластичность замещения между трудом и капиталом в обрабатывающей промышленности; производственные функции различного типа.
Citations
More filters
TL;DR: In this paper, an endogenous growth model with a simple climate system is used to examine the potential impacts of climate change on the capital-to-net income ratio and the net of depreciation share of income to capital, a measure of wealth concentration and income distribution between capital and labour respectively, over the next two centuries.
9 citations
TL;DR: In this article, the impacts of factor endowment on international trade in a general equilibrium model were studied in which firms choose their technologies endogenously and showed that if industries choose different capital-labor intensities in equilibrium, the Heckscher-Ohlin theorem, factor price equalization theorem, Rybczynski theorem, and Stolper-Samuelson theorem hold.
Abstract: This paper studies impacts of factor endowment on international trade in a general equilibrium model in which firms choose their technologies endogenously. Although countries only differ in factor endowment ex ante, countries may also differ in their chosen technologies. If industries choose different capital-labor intensities in equilibrium, the Heckscher–Ohlin theorem, factor price equalization theorem, the Rybczynski theorem, and the Stolper–Samuelson theorem hold. If industries choose the same capital-labor intensity in equilibrium, the volume of trade is zero. None of the four theorems applies.
9 citations
Cites background from "Capital-labor substitution and econ..."
...The degree of substitution of an industry can be measured by empirical studies, such as the one conducted in Arrow et al. (1961). In the following, the case that industries choose the same factor intensity and the case that industries choose different factor intensities are studied sequentially....
[...]
...Arrow et al. (1961) argue that this type of substitution is very important in various fields of economics....
[...]
...Arrow et al. (1961) argue that this type of substitution is very important in various fields of economics. Minhas (1962) formally explores the implications of this type of substitution in international trade....
[...]
...The degree of substitution of an industry can be measured by empirical studies, such as the one conducted in Arrow et al. (1961)....
[...]
TL;DR: In this paper, the authors apply the framework of ACEmoglu, D. (2002, ‘Directed technical change’, The Review of Economic Studies, 69, 781-809) to develop explanations for the following questions: What kind of production function is appropriate to special economies? If and to what degree technical change is biased towards particular factors? Based on interprovincial panel data of China, they show that: First, biased production functions are more appropriate than neutral ones.
Abstract: Technical change is usually biased and benefits some factors more than others; however, the literature on the effect of technical progress is limited to the direction of technical change. For developing countries, whether technical change is biased towards particular factors is of central importance. We apply the framework of Acemoglu, D. (2002, ‘Directed technical change’, The Review of Economic Studies, 69, 781–809) to develop explanations for the following questions: What kind of production function is appropriate to special economies? If and to what degree technical change is biased towards particular factors? Based on inter-provincial panel data of China, this paper shows that: First, biased production functions are more appropriate than neutral ones. Second, the elasticity of substitution between labour and capital is less than a unity within the interval of 0.50 to 0.70, which indicates the asymmetric effect of technical progress on the productivity of capital and labour (a bias clearly in favour o...
9 citations
Additional excerpts
...Arrow et al. (1961) prove that production functions with fixed elasticity of substitution could be represented by the CES function....
[...]
TL;DR: Simulations of the relationship between data envelopment analysis (DEA) efficiency and major production functions: Cobb-Douglas, the constant elasticity of substitution, and the transcendental logarithmic find that the degree of homogeneity has the largest effect on efficiency.
Abstract: In this paper, we use simulations to investigate the relationship between data envelopment analysis (DEA) efficiency and major production functions: Cobb-Douglas, the constant elasticity of substitution, and the transcendental logarithmic. Two DEA models were used: a constant return to scale (CCR model), and a variable return to scale (BCC model). Each of the models was investigated in two versions: with bounded and unbounded weights. Two cases were simulated: with and without errors in the production functions estimation. Various degrees of homogeneity (of the production function) were tested, reflecting a constant increasing and decreasing return to scale. With respect to the case with errors, three distribution functions were utilized: uniform, normal, and double exponential. For each distribution, 16 levels of the coefficient of variance (CV) were used. In all the tested cases, two measures were analysed: the percentage of efficient units (from the total number of units), and the average efficiency score. We applied a regression analysis to test the relationship between these two efficiency measures and the above parameters. Overall, we found that the degree of homogeneity has the largest effect on efficiency. Efficiency declines as the errors grow (as reflected by larger CV and of the expansion of the probability distribution function away from the centre). The bounds on the weights tend to smooth the effect, and bring the various DEA versions closer to one other. The type of efficiency measure has similar regression tendencies. Finally, the relationship between the efficiency measures and the explanatory variables is quadratic.
9 citations
Cites background from "Capital-labor substitution and econ..."
...Production functions do have certain limitations (see Arrow et al. 1961; Chambers et al. 1998), in that the fixed elasticity of substitution is often not valid, due to limitations in technology transfer....
[...]
TL;DR: In this article, the authors extend Simon's argument that production functions should ideally be estimated using physical data, and discuss the serious problems that arise when they are estimated using constant-price monetary data.
Abstract: Scott Carter (2011) reproduces and discusses correspondence between Simon and Solow in 1971, where Simon first outlined his critique that estimations of production functions merely capture an underlying accounting identity. This idea culminated in a paper published by Simon in 1979 in the Scandinavian Journal of Economics. We extend Simon's argument that production functions should ideally be estimated using physical data, and discuss the serious problems that arise when they are estimated using constant-price monetary data. Simon also suggested that the good statistical fits to production functions could be derived from a markup pricing model, but he did not follow this up. We show that this can indeed account for the very good statistical fits of the Cobb-Douglas and other production functions. We conclude by showing how estimates of cost functions suffer from the same problem.
9 citations
Cites background from "Capital-labor substitution and econ..."
...The same comment applies to the SMaC [Solow, Minhas, arrow, and Chenery; see arrow et al. 1961] production function....
[...]
References
More filters
TL;DR: In this article, the authors proposed a method to improve the performance of the system by using the information of the user's interaction with the system and the system itself, including the interaction between the two parties.
Abstract: В статье производится анализ агрегированной производственной функции, вводится аппарат, позволяющий различать движение вдоль такой функции от ее сдвигов. На основании сделанных в статье предположений делаются выводы о характере технического прогресса и технологических изменений. Существенное внимание уделяется вариантам применения концепции агрегированной производственной функции.
10,850 citations
3,961 citations
Book•
01 Jan 1956TL;DR: In this paper, a very brief treatment of three questions relating to the history of our economic growth since the Civil War is given, namely: (1) How large has been the net increase of aggregate output per capita, and to what extent has this increase been obtained as a result of greater labor or capital input on the one hand and of a rise in productivity on the other? (2) Is there evidence of retardation, or conceivably acceleration, in the growth of per capita output? (3) Have there been fluctuations in the rate of growth of output, apart
Abstract: Introduction This paper is a very brief treatment of three questions relating to the history of our economic growth since the Civil War: (1) How large has been the net increase of aggregate output per capita, and to what extent has this increase been obtained as a result of greater labor or capital input on the one hand and of a rise in productivity on the other? (2) Is there evidence of retardation, or conceivably acceleration, in the growth of per capita output? (3) Have there been fluctuations in the rate of growth of output, apart from the shortterm fluctuations of business cycles, and, if so, what is the significance of these swings? The answers to these three questions, to the extent that they can be given, represent, of course, only a tiny fraction of the historical experience relevant to the problems of growth. Even so, anyone acquainted with their complexity will realize that no one of them, much less all three, can be treated satisfactorily in a short space. I shall have to pronounce upon them somewhat arbitrarily. My ability to deal with them at all is a reflection of one of the more important, though one of the less obvious, of the many aspects of our growing wealth, namely, the accumulation of historical statistics in this country during the last generation. For the most part, the figures which I present or which underlie my qualitative statements are taken directly from tables of estimates of national product, labor force, productivity, and the like compiled by others.
1,031 citations
903 citations