The general equilibrium effects of localised technological progress: A Classical approach

Naoki Yoshihara () and Roberto Veneziani

No 735, Discussion Paper Series from Institute of Economic Research, Hitotsubashi University

Abstract: We study the general equilibrium effects of localised technical progress à la Atkinson-Stiglitz on income distribution in economies in which capital is a vector of reproducible and heterogeneous goods. We show that there is no obvious relation between ex-ante profitable innovations and the income distribution that actually emerges in equilibrium. Unlike in the standard macroeconomic literature, localised technical progress may lead to indeterminacy in equilibrium factor prices, and individually rational choices of technique do not necessarily lead to optimal outcomes. Innovations may even cause the disappearance of all equilibria.

Keywords: localised technical progress; income distribution; equilibrium framework (search for similar items in EconPapers)
JEL-codes: D33 D51 O33 (search for similar items in EconPapers)
Pages: 42 pages
Date: 2022-09
New Economics Papers: this item is included in nep-dge and nep-hme
Note: September 15, 2022
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https://hermes-ir.lib.hit-u.ac.jp/hermes/ir/re/74305/DP735.pdf

Related works:
Journal Article: The general equilibrium effects of localised technological progress: A Classical approach (2023)
Working Paper: The general equilibrium effects of localised technological progress: A Classical approach (2023)
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Persistent link: https://EconPapers.repec.org/RePEc:hit:hituec:735

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