Capital-Labor Substitution and Economic Efficiency

Arrow, Kenneth J.; Chenery, Hollis B.; Minhas, Bagicha S.; Solow, Robert M.

doi:10.2307/1927286

Cited by 1,718 publications

(813 citation statements)

References 6 publications

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“…In (1) a is the distribution parameter (see e.g. Arrow et al (1961)) between the production factors, while captures the elasticity of substitution between the two different types of labour inputs. In what follows we assume that 1 0 .…”

Section: Basic Frameworkmentioning

confidence: 99%

Equilibrium unemployment with outsourcing under labour market imperfections

Koskela

Stenbacka

2009

Labour Economics

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We study both the various consequences and the incentives of outsourcing. We argue that the wage elasticity of labour demand is increasing as a function of the share of outsourcing, which is a result consistent with existing empirical research. Furthermore, we show that a production mode with a higher proportion of outsourcing activity reduces the negotiated wage in the high-wage country with an imperfectly competitive labour market so that outsourcing reduces equilibrium unemployment. Finally, we characterize the optimal production mode and show that stronger labour market imperfections lead to a production mode with a higher share of outsourcing.JEL Classification: E23, E24, J51, J64.

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Section: Basic Frameworkmentioning

confidence: 99%

Equilibrium unemployment with outsourcing under labour market imperfections

Koskela

Stenbacka

2009

Labour Economics

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“…In traditional neoclassical models, technological change is determined exogenously, where it increases factor productivity (e.g. for analytical studies, Arrow et al 1961, Kennedy 1962and Uzawa 1965, and for empirical studies, Peck and Teisberg 1994;Nordhaus 1994 andNordhaus andYang 1996). New growth theory places more emphasis on the endogenous role of technology and its positive externalities that drive economic growth (Romer 1990, Griliches 1992, and Grossman and Helpman 1994.…”

Section: Technology and Coalition Formationmentioning

confidence: 99%

Technology spillovers and stability of international climate coalitions

Nagashima

Dellink

2008

Int Environ Agreements

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Cooperation in international environmental agreements appears difficult to attain because of strong free-rider incentives. This paper explores how different technology spillover mechanisms among regions can influence the incentives to join and stabilise an international agreement. We use an applied modelling framework (STACO) that enables us to investigate the stability of partial climate coalitions. Several theories on the impact of technology spillovers are evaluated by simulating a range of alternative specifications. We find that spillovers are a good instrument to increase the abatement efforts of coalitions and reduce the associated costs. In our setting, however, they cannot overcome the strong free-rider incentives that are present in larger coalitions, i.e. technology spillovers do not substantially increase the success of international environmental agreements. This conclusion is robust with respect to the specification of technology spillovers.

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“…with ρ → 0 (Arrow, et al, 1961). CES is commonly used in general equilibrium modeling (Shoven & Whalley, 1992), including some of our prior work.…”

Section: Theorem 6 Let U Be a Continuous Strictly Concave Function Omentioning

confidence: 99%

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Wellman

1998

Machine Learning

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Abstract. Learning in a multiagent environment is complicated by the fact that as other agents learn, the environment effectively changes. Moreover, other agents' actions are often not directly observable, and the actions taken by the learning agent can strongly bias which range of behaviors are encountered. We define the concept of a conjectural equilibrium, where all agents' expectations are realized, and each agent responds optimally to its expectations. We present a generic multiagent exchange situation, in which competitive behavior constitutes a conjectural equilibrium. We then introduce an agent that executes a more sophisticated strategic learning strategy, building a model of the response of other agents. We find that the system reliably converges to a conjectural equilibrium, but that the final result achieved is highly sensitive to initial belief. In essence, the strategic learner's actions tend to fulfill its expectations. Depending on the starting point, the agent may be better or worse off than had it not attempted to learn a model of the other agents at all.

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Capital-Labor Substitution and Economic Efficiency

Cited by 1,718 publications

References 6 publications

Equilibrium unemployment with outsourcing under labour market imperfections

Equilibrium unemployment with outsourcing under labour market imperfections

Technology spillovers and stability of international climate coalitions

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