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.
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01 Jan 1979
TL;DR: In this article, a general mathematical framework for modeling economies under deformation is developed by expanding Herbert Scarf's original activity analysis formulation to include uncountable unit activity sets, unbounded multi-valued demand correspondences, and tax and revenue systems similar to those introduced by John Shoven and John Whalley.
Abstract: A philosophical problem arises when one attempts to predict a competitive economy's response to a fundamental change in its structure with the aid of a competitive equilibrium model. Unless the model is known to admit unique solutions, there is little basis for assuming that the computed equilibrium will be attained, even though the model accurately describes the economy's structure and the behavior of its agents. If, however, one is able to arrive at the new model by continuously deforming the old one, then the two versions generally admit solutions which are connected by a path of equilibria arising from the continuum of intermediate economies. By ascribing a suitable dynamic interpretation to the deformation, one obtains a rationale for expecting the path-connected solutions to be mutually attained. The description of economic deformations and the computation of equilibrium paths is the central theme of this study. A general mathematical framework for modeling economies under deformation is developed by expanding Herbert Scarf's original activity analysis formulation to include uncountable unit activity sets, unbounded multi-valued demand correspondences, and tax and revenue systems similar to those introduced by John Shoven and John Whalley. Deformations of virtually all economic constructs are allowed in this general model. The computation of equilibrium paths is accomplished by a simplicial pivot algorithm designed along the lines of the homotopy-type fixed point techniques pioneered by Curtis Eaves. The dimension normally used to refine piecewise linear approximations now serves as the index of the economic deformation. To make this approach viable in practice, a new family of triangulations of Euclidean space is fashioned out of two conventional triangulations invented by Michael Todd. The geometry of these triangulations can be dynamically altered by the algorithm as it attempts to maintain uniform approximation error along the equilibrium path. The economic model and computational algorithm are translated into a set of computer routines which generate explicit numerical approximations to equilibrium paths for a variety of examples. Due to the vast amount of information embodied in an equilibrium path, problems of this type require a great deal of computational effort. A detailed analysis of the behavior of the algorithm on a series of test problems is presented in the final chapter.
7 citations
Book•
09 May 2017TL;DR: Broughel et al. as mentioned in this paper provide a theoretical framework for understanding how regulations affect economic growth by reviewing what economists have learned about growth over the past 60 years and by describing the puzzles yet to be solved.
Abstract: Government regulation is a double-edged sword. By restricting the inputs—capital, labor, technology, and more—that can be used in the production process, regulation shapes the economy and, by extension, living standards today and in the future. Applied effectively, regulation can foster a thriving, competitive marketplace where innovation and technological progress flourish. Executed poorly, regulation can stifle creativity and learning and limit opportunities for all citizens.
In this brief but authoritative work, James Broughel lays out a basic theoretical framework for understanding how regulations affect economic growth. He provides a useful starting point for researchers of regulation and growth by reviewing what economists have learned about growth over the past 60 years and by describing the puzzles yet to be solved.
The book includes a unique classification system for distinguishing among the various “shocks” induced by regulation and tracking how these shocks translate into “effects” in terms of economic growth. It should prove helpful to academic researchers, advanced undergraduate and graduate students, policymakers, and anyone else who wishes to assess with greater precision the repercussions of the complex web of rules that governs our lives.
7 citations
TL;DR: This article showed that the original and subsequent derivations of Hicks' celebrated formula contained a slip (that factor shares are independent of the substitution elasticity and therefore constant), presents a new derivation and a corrected formula, and demonstrates that, with the corrected model, Marshall's First Rule based on the elasticity is no longer generally valid.
7 citations
01 Jan 2020
TL;DR: In this paper, the authors present a theoretical foundation for the measurement of the degree of substitutability among inputs utilized in a production process and explore the relationship between elasticity values and the comparative statics of factor income shares.
Abstract: This draft chapter, prepared for inclusion in the (prospective) Handbook of Production Economics, Vol. 1 (Theory), edited by Subash Ray, Robert Chambers, and Subal Kumbhakar, lays out the theoretical foundation of the measurement of the degree of substitutability among inputs utilized in a production process. It proceeds from the well-settled (Hicksian) notion of this measure for two inputs (typically labor and capital) to the more challenging conceptualization for technologies with more than two inputs (most notably, Allen-Uzawa and Morishima elasticities). Dual elasticities of substitution (also called elasticities of complementary) and gross elasticities of substitution (measuring substitutability for non-homothetic technologies taking account of output changes) are also covered. Also analyzed are functional representations of two-input technologies with constant elasticity of substitution (CES) and of n-input technologies with constant and identical elasticities for all pairs of inputs. Finally, the chapter explores the relationship between elasticity values and the comparative statics of factor income shares and the relationships between certain elasticity identities and separability conditions rationalizing consistent aggregation of subsets of inputs.
7 citations
TL;DR: Wang et al. as mentioned in this paper argued that neither efficiency-oriented market wage system nor use of the equity-oriented planned wage system can solve the dual problem of economic growth and income distribution, and a synergy of the two systems will therefore be needed.
Abstract: Wage reform is an important aspect of Chinese economic reform. The success of wage reform is likely to depend upon the following understanding: Neither use of the efficiency‐oriented market wage system nor use of the equity‐oriented planned wage system can solve the dual problem of economic growth and income distribution. A synergy of the two systems will therefore be needed. Such a synergetic wage system, which simultaneously solves the dual problem of production and distribution, can expedite the rise of social productivity – the fundamental mission in the preliminary stage of Chinese socialism. In other words, wages should be differentiated, and the differences should be related to workers′ effort and society′s demand for them. These differences, however, need not be very large.
7 citations
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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.
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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