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Factor price
About: Factor price is a research topic. Over the lifetime, 2764 publications have been published within this topic receiving 86176 citations.
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TL;DR: In this paper, the authors construct and numerically solve a dynamic Heckscher-Ohlin model in which the initial distribution of production factors in the world makes worldwide factor price equalization impossible, and leads countries to group in two diversification cones.
Abstract: We construct and numerically solve a dynamic Heckscher-Ohlin model in which the initial distribution of production factors in the world makes worldwide factor price equalization impossible, and leads countries to group in two diversification cones. We study the dynamics of income per capita and factor prices. Our results suggest that the Ramsey model under complete specialization overcomes several shortcomings of its autarky and factor price equalization counterparts. In comparison with the autarky model, for example, it can produce similar transitional dynamics and account for important cross-sectional differences in the levels and growth rates of income per capita while generating much smaller rental-rate differentials across countries. Moreover, it does not necessarily yield convergence in levels for identically parameterized economies. All in all, the Ramsey/Complete Specialization model seems to provide a better benchmark from which to depart when studying the dynamic behaviour of countries and cross-sectional differences in income per capita levels and growth rates.
42 citations
TL;DR: The computerization of retailing has made price dispersion a norm in the United States, so that any given list price or transactions price is an increasingly imperfect measure of a product's resource cost as mentioned in this paper.
Abstract: The computerization of retailing has made price dispersion a norm in the United States, so that any given list price or transactions price is an increasingly imperfect measure of a product's resource cost. As a consequence, measuring the real output of retailers has become increasingly difficult. Food retailing is used as a case study to examine data problems in retail productivity measurement. Crude direct measures of grocery store output suggest that the CPI for food-at-home may have been overstated by 1.4 percentage points annually from 1978 to 1996.(This abstract was borrowed from another version of this item.)
42 citations
TL;DR: In this paper, the authors report on an analysis of productivity growth and input trends in six energy intensive sectors of the Indian economy, using growth accounting and econometric methods, and suggest that, as with previous findings on the US economy, such policies in India could have negative long run effects on productivity in these sectors.
Abstract: This paper reports on an analysis of productivity growth and input trends in six energy intensive sectors of the Indian economy, using growth accounting and econometric methods. The econometric work estimates rates and factor price biases of technological change using a translog production model with an explicit relationship defined for technological change. Estimates of own-price responses indicate that raising energy prices would be an effective carbon abatement policy for India. At the same time, the authors results suggest that, as with previous findings on the US economy, such policies in India could have negative long run effects on productivity in these sectors. Inter-input substitution possibilities are relatively weak, so that such policies might have negative short and medium term effects on sectoral growth. The authors study provides information relevant for the analysis of costs and benefits of carbon abatement policies applied to India and thus contributes to the emerging body of modeling and analysis of global climate policy.
42 citations
TL;DR: It is shown that the retailer does not always prefer price leadership over a manufacturer, and that the retailers' strategic choice over price leadership with one manufacturer depends upon its price leadership type with the competing manufacturer and the degree of product substitutability.
42 citations
TL;DR: In this paper, a formal evolutionary model is presented in which essentially neoclassical conclusions regarding the effect of factor prices on factor ratios are deduced without any recourse to concepts either of maximization or industry equilibrium.
Abstract: This paper argues that economists have been schizophrenic regarding the theory of the firm in a competitive industry In much (but not all) of their formal mathematical modeling, maximization and equilibrium are taken literally Ordinarily, however, both maximization and equilibrium are interpreted as tendencies in the verbal articulation Such a "tendency" theory, which is thought by many economists to be closer to reality, is believed to be intrinsically difficult to formalize in such a way as to obtain verifiable theorems -- for example, that a shift in the ratio of the factor prices will induce the industry to change factor proportions in the opposite direction This paper offers a more optimistic view of the prospects for formalizing this tendency approach A formal evolutionary model is presented in which essentially neoclassical conclusions regarding the effect of factor prices on factor ratios are deduced without any recourse to concepts either of maximization or industry equilibrium
41 citations