Market Frictions, Technology Adoption and Economic Growth

Been-Lon Chen, Jie-Ping Mo and Ping Wang
Additional contact information
Jie-Ping Mo: Institute of Economics; Academia Sinica, Taiwan

No 34, Vanderbilt University Department of Economics Working Papers from Vanderbilt University Department of Economics

Abstract: This paper develops an endogenous growth model with labor market matching and technology adoption. While labor market search and entry frictions lengthen technology diffusion, exogenous technology arrival may creatively destruct jobs in the short run. Such interrelationships give rise to multiple equilibria (global and local indeterminacy) under which a small autonomous technological improvement may create a large growth effect. We characterize the effects of exogenous technology arrival on equilibrium matching, adoption effort, wage and the overall dispersion of wages. Social inefficiency arises as a result of individuals' failure to account for free-rider, thick-matching, job-destruction effects in making technology adoption decision.

Keywords: Technological Diffusion; Labor Market Search and Matching; Endogenous Growth (search for similar items in EconPapers)
JEL-codes: D83 O33 O41 (search for similar items in EconPapers)
Date: 2000-08
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.accessecon.com/pubs/VUECON/vu00-w34.pdf REvised version, 2000 (application/pdf)

Related works:
Journal Article: Market frictions, technology adoption and economic growth (2002)
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:van:wpaper:0034

Access Statistics for this paper

More papers in Vanderbilt University Department of Economics Working Papers from Vanderbilt University Department of Economics Contact information at EDIRC.
Bibliographic data for series maintained by John P. Conley ().