Technological Progress and Investment: A Non-Technical Survey

Raouf Boucekkine () and Bruno de Oliveira Cruz ()
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Bruno de Oliveira Cruz: IPEA - Instituto de Pesquisa Economica Aplicada, Brasilia (Brasil), http://www.ipea.gov.br/portal/index.php?option=com_content&Itemid=61

No 1519, AMSE Working Papers from Aix-Marseille School of Economics, France

Abstract: This paper presents a non-technical overview of the recent investment literature with a special emphasis on the connection between technological progress and the investment decision. First of all, we acknowledge that some dramatic advances have been made in the 1990s in understanding and modelling non-convex capital adjustment schemes and irreversibility. Nonetheless, this new literature has not always satisfactorily accounted for the investment-specific (or embodied) nature of technical progress. We argue that the recent technological trends towards more embodiment have had a heavy impact on the way the investment decision is taken and is to be taken. This is turn should imply the reconsideration of many empirical results, and a more careful modelling strategy taking into account the price variables and scrupulously choosing the most appropriate level of (dis)aggregation.

Keywords: Investment; Technological progress; Non-convex adjustment; irreversibility; Embodiment. (search for similar items in EconPapers)
JEL-codes: E22 E32 O40 (search for similar items in EconPapers)
Pages: 27 pages
Date: 2015-04-24
New Economics Papers: this item is included in nep-mac
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Related works:
Working Paper: Technological Progress and Investment: A Non-Technical Survey (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:aim:wpaimx:1519

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