by Hideyuki Adachi (Author), Kazuyuki Inagaki (Author), Tamotsu Nakamura (Author), and Yasuyuki Osumi
About this book
This volume develops original methods of analyzing biased technological progress in the theory and empirics of economic growth and income distribution. Motivated by sharp increases in wage and income inequalities in the world since the beginning of the new century, many macroeconomists have begun to realize the importance of biased technological changes. However, the comprehensive explanations have not yet appeared. This volume analyzes the effects of factor-biased technological progress on growth and income distribution and shows that long-run trends of the capital-income ratio and capital share of income consistent with Piketty’s 2014 empirical results emerge. Incorporating the modified version of induced innovation theory into the standard neoclassical growth model, it also explains the long-run fluctuations of growth and income distribution consistent with the data shown in Piketty. Introducing a wage-setting function, the neoclassical growth model is modified to account for unemployment as well as to examine the dynamics of unemployment and the labor share of income under biased technological progress. Applying a new econometric method to Japanese industrial data, the authors test the key assumptions employed and important results derived in the theoretical part of this book.
Contents
1 Growth and Income Distribution Under Biased Technological Progress
1.1 Introduction
1.2 Long-Term Fluctuations in Income Distribution—Piketty’s Empirical Results and Theoretical Explanation
1.2.1 Piketty’s Empirical Results
1.2.2 Piketty’s Theoretical Explanation
1.3 Analysis of Growth and Income Distribution Based on the Neoclassical Growth Model
1.3.1 A Neoclassical Growth Model Including Biased Technological Progress
1.3.2 Classification of Technological Progress
1.3.3 Growth and Income Distribution Under Neutral Technological Progress
1.4 Economic Growth and Income Distribution Under Biased Technological Progress
1.4.1 Capital-Labor Substitution: An Elasticity Less Than Unity
1.4.2 The Case of Labor-Saving Technological Progress ( β < 0 and σ < 1)
1.4.3 The Case of Capital-Saving Technological Progress ( β > 0 and σ < 1)
1.4.4 The Case in Which the Elasticity of Substitution Between Labor and Capital σ Is Larger Than Unity
1.5 Conditions for the Introduction of Biased Technology and Its Direct Effects
1.5.1 Conditions for the Introduction of Biased Technology
1.5.2 Direct Effects of the Introduction of Biased Technology
1.6 Conclusions
2 Growth and Income Distribution Under Induced Innovation
2.1 Introduction
2.2 Decisions on Employment, Investment and Technology
2.3 Long-Run Dynamics and Biased Technological Progress
2.3.1 The Model of Long-Run Dynamics
2.3.2 Dynamics When σ < 1
2.3.3 Dynamics When σ > 1
2.3.4 The Effects of Population Growth and Saving Rates
2.4 Interactions Between Innovation and Capital Accumulation
2.4.1 Investment and Technological Progress
2.4.2 The Long-Run Model and Dynamics
2.5 Optimal Technological Progress for the Firm and for Society as a Whole
2.6 Conclusions
Mathematical Appendix
3 Technological Progress and Unemployment
3.1 Introduction
3.2 Model
3.3 Growth and Employment
3.3.1 Dynamics of the Employment Rate
3.3.2 The Steady State Equilibrium and the Employment Rate
3.3.3 Monopoly and the Labor Market
3.4 Biased Technological Progress and Unemployment
3.4.1 Decisions of Firms on the Type of Technological Progress
3.4.2 Effects of Biased Technological Progress on Unemployment
3.5 Induced Innovation and Unemployment
3.5.1 A Model of Innovation and Unemployment
3.5.2 Dynamics and Unemployment: The Case of σ < 1
3.5.3 Dynamics and Unemployment: The Case of σ > 1
3.6 Profit Maximization Versus Social Welfare Maximization
3.7 Conclusions
4 Empirical Analysis of Biased Technological Progress
4.1 New Procedure for Estimation of Efficiency Coefficients and Elasticity of Substitution
4.1.1 Model
4.1.2 Data
4.1.3 Estimation Results of σ
4.2 Estimation of Efficiency Coefficients A and B
4.3 Introduction of Biased Technology
4.4 Interpretation for the Dynamics of the Labor Share of Income
4.4.1 Graphical Analysis
4.4.2 Estimation of Error Correction Model
4.5 Empirical Analysis of a Trade-off Between Types of Technological Progress
4.6 Effects of Technological Progress on Unemployment
4.7 Conclusions
5 Concluding Remarks
5.1 Interpretation of the Results
5.2 Policy Implications and Further Research
References
Series: SpringerBriefs in Economics
Length: 90 pages
Publisher: Springer; 1st ed. 2019 edition (March 19, 2019)
Language: English
ISBN-10: 981133725X
ISBN-13: 978-9811337253
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