A New Theory of Industrialization

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This paper constructs an equilibrium model with consumer-producers, economies of specialization and transaction costs. The comparative statics of equilibrium can be used to predict several concurrent phenomena associated with an industrialization process: an increase in productivity, an increase in trade dependence, increase in the division of labor and specialization, the emergence of new producer goods at a layer of the hierarchy of goods, and an increase in the number of layers of the hierarchy, increases in the diversity of the economicstructure and in the degree of interation of the economy, and an increase in capital goods.

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关键词：Industrial ndustrial Theory trial ATION Theory NEW

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