distorts occupational choice. We study this possibility in the context of a model with horizontal innovation, where the …

occupation it may harm some workers while benefitting others; and it may either reduce or increase the proportion of knowledge … workers in employment. In my model, knowledge (in a broad sense) is an input into the production function of human capital …-quality one. People differ in their exogenous ability and ability is complementary with the quality of the knowledge input in the …

satiation. This, despite that the social costs of innovation are second order compared to their social benefits. Multiple … savings reduces interest rates, which boosts the rate of innovation. When TFP grows exogenously and labor supply is …

or in the knowledge sector, which designs new varieties. It is shown that if the elasticity of labor supply to the … knowledge sector is bounded, as productivity increases, the economy moves from a "Solovian zone" where wages increase with …