Structural change and non-constant biased technical change

Edgar Cruz

The B.E. Journal of Macroeconomics, 2017, vol. 17, issue 2, 23

Abstract: Empirical evidence suggests that the differences in rates of technical progress across sectors are time-variant, implying that the bias in technological change is not constant. In this paper, we analyze the implications of this non-constant sectoral biased technical change for structural change and we assess whether this is an important factor behind structural transformations. To this end, we develop a multi-sectoral growth model where TFP growth rates across sectors are non-constant. We calibrate our model to match the development of the U.S. economy during the twentieth century. Our findings show that, by assuming non-constant biased technical change, a purely technological approach is able to replicate the sectoral transformations in the U.S. economy not only after but also prior to World War II.

Keywords: Baumol effect; multi-sector growth model; sector biased technical change; structural change (search for similar items in EconPapers)
JEL-codes: O41 O47 (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (1)

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Working Paper: Structural Change and Non-Constant Biased Technical Change (2015)
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DOI: 10.1515/bejm-2015-0046

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