Impact of Technology Assimilation on Investment Policy: Dynamic Optimization and Econometric Identification

B. K. Ane, A. M. Tarasyev () and C. Watanabe
Additional contact information
B. K. Ane: Tokyo Institute of Technology
A. M. Tarasyev: Institute of Mathematics and Mechanics
C. Watanabe: Tokyo Institute of Technology

Journal of Optimization Theory and Applications, 2007, vol. 134, issue 2, No 10, 338 pages

Abstract: Abstract The paper introduces a dynamic model of optimization of R&D intensity under the effect of technology assimilation. The model involves R&D investments, technology stock, production, and technology productivity as main variables. The model characterizes the “growth” and “decline” trends that describe the interaction between R&D investments and transformation process of production factors. The technology stock is constructed as a function of indigenous and exogenous technology stocks and their growth rates. The research focuses on the issue of a reasonable balance between the indigenous technology stock and assimilated technology flow. Econometric linearization of the technology assimilation effect is used to construct a reasonable optimal control model. The existence of the value function for the problem of the optimal economic growth on the infinite horizon is proved and the basic features of the value function are outlined. The property of strong invariance for the main proportions of the model such as technology productivity and R&D intensity is proved. The model is calibrated on the aggregate data of the Japanese automotive industry.

Keywords: Economic growth; Optimal control problems; Value function; Strong invariance; Absorption capacity; Econometric characteristics (search for similar items in EconPapers)
Date: 2007
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1007/s10957-007-9258-1 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

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:spr:joptap:v:134:y:2007:i:2:d:10.1007_s10957-007-9258-1

Ordering information: This journal article can be ordered from
http://www.springer. ... cs/journal/10957/PS2

DOI: 10.1007/s10957-007-9258-1

Access Statistics for this article

Journal of Optimization Theory and Applications is currently edited by Franco Giannessi and David G. Hull

More articles in Journal of Optimization Theory and Applications from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().