Factor-eliminating technical change

A-Tier
Journal: Journal of Monetary Economics
Year: 2013
Volume: 60
Issue: 4
Pages: 459-473

Score contribution per author:

2.011 = (α=2.01 / 2 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

Perpetual growth requires offsetting diminishing returns to reproducible factors of production. In this article we present a theory of factor elimination. For simplicity and clarity, there is no augmentation of non-reproducible factors, thus excluding the standard engine of growth. By spending resources on R&D, agents learn to change the exponents of a Cobb–Douglas production function. We obtain the economy's balanced growth path and complete transition dynamics. The theory provides a mechanism for the transition from an initial technology incapable of supporting perpetual growth to one with constant returns to reproducible factors that supports it.

Technical Details

RePEc Handle
repec:eee:moneco:v:60:y:2013:i:4:p:459-473
Journal Field
Macro
Author Count
2
Added to Database
2026-01-29