Direction and Intensity of Technical Change: a Micro Model

Luca Zamparelli ()

No 4, Working Papers from Doctoral School of Economics, Sapienza University of Rome

Abstract: This paper develops a growth model combining elements of endogenous growth and induced innovation literatures. In a standard induced innovation model firms select at no cost innovations from an innovation possibilities frontier describing the trade-off between increasing capital or labor productivity. The model proposed allows firms to choose not only the direction but also the size of innovation by representing the innovation possibilities through a cost function of capital and labor augmenting innovations. By so doing, it provides a micro-foundation both of the intensity and of the direction of technical change. The policy analysis implies that an increase in subsidies to R&D as opposed to capital accumulation raises per capita steady state growth, employment rate and wage share.

Keywords: Induced innovation; endogenous growth; direction of technical change (search for similar items in EconPapers)
JEL-codes: O31 O33 O40 (search for similar items in EconPapers)
Pages: 22 pages
Date: 2009-02
New Economics Papers: this item is included in nep-dge, nep-eff, nep-ino, nep-knm, nep-lab and nep-mic
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://phdschool-economics.dse.uniroma1.it/website ... rs/zamparelliWP4.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 500 Can't connect to phdschool-economics.dse.uniroma1.it:80 (A connection attempt failed because the connected party did not properly respond after a period of time, or established connection failed because connected host has failed to respond.)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:dsc:wpaper:4

Access Statistics for this paper

More papers in Working Papers from Doctoral School of Economics, Sapienza University of Rome Contact information at EDIRC.
Bibliographic data for series maintained by Claudio Sardoni ().