Biased Technical Change and the Aggregate Production Function
This paper offers a classical model of biased technical change in the MarxRicardo tradition as a framework for theoretical and applied studies of growth. The observable data it generates would appear to an unsuspecting economist to be well-described by a neoclassical model with a static Cobb-Douglas production function, when in fact this production function describes only the technological history of the economy. The CobbDouglas form results from the capital-using, labour-saving bias of technical change. The model's trajectory in wage-profit space will lie along the displaced image of the neoclassical factor price frontier, in contradiction to marginal productivity theory. The Solow residual can be reinterpreted by the classical theory as a measure of the size of this displacement.
Year of publication: |
1999
|
---|---|
Authors: | Michl, Thomas |
Published in: |
International Review of Applied Economics. - Taylor & Francis Journals, ISSN 0269-2171. - Vol. 13.1999, 2, p. 193-206
|
Publisher: |
Taylor & Francis Journals |
Saved in:
Online Resource
Saved in favorites
Similar items by person
-
Three models of the falling rate of profit
Michl, Thomas R., (1992)
-
Capital and labor productivity
Michl, Thomas R., (1991)
-
Debt, deficits, and the distribution of income
Michl, Thomas R., (1990)
- More ...