Questions tagged [technology]

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What are driving factors behind the recent slew of layoffs in the US tech industry (to the extent we understand them)?

Is this phenomenon something that economists think they have an understanding of? As an outsider, I'm very confused. The tech industry seems to be making a lot of money right now. Why is all of this ...
3 votes
1 answer
66 views

Marginal and Average Cost in the Romer Model of Endogenous Growth

On page 124 of David Romer's Advanced Macroeconomics (5th Ed), he mentioned that for the Romer model, Because firms producing final output face constant costs for each input and the production ...
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1 answer
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How would you measure automation or technological development?

Hello dear Economists, I am a Political Science Masters student and now I have this paper due 10 days. It is only a paper so I should not model something too complex and also I obviously lack the ...
1 vote
1 answer
66 views

Why Is Having a Strong Manufacturing Base Important to a Country's Economy?

I was living in Pittsburgh in my teens and twenties during the collapse of the steel industry and remember how profoundly it impacted Pittsburgh. Some say that due to the large percentage of the ...
0 votes
0 answers
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How Marxian economists evaluate current and future technologies for making investment decisions?

Current Marxian economists are incredibly vague about the merits of technologies and about concrete investment decisions, at least, the Western Marxian economists are. E.g. there is book https://www....
1 vote
0 answers
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Technology Parameter In Converted Minimisation Problem

Question: I want to understand what's going on with respect to the technology parameter $A$ when i convert this minimisation problem into a maximisation problem. The issue is only revealed when i use ...
1 vote
1 answer
322 views

Convexity of production sets and input requirement sets

The following question is from Microeconomic Analysis by Hal R Varian. True or false? If V(y) is a convex set, then the associated production set Y must be convex. The solution available says; False. ...
38 votes
2 answers
7k views

Why does Taiwan dominate the semiconductors market?

The recent visit of US politician Nancy Pelosi to Taiwan generated a lot of news about the dependence the world has on Taiwan, given its dominance of the semiconductor market. But I couldn't find ...
2 votes
0 answers
28 views

Design of technology-neutral policy in the presence of multiple market failures

I am studying a paper by Aisbett, Cheng & Beck which considers the pros and cons of technological neutrality in green industrial policy. At the start of section 5.6 it refers to the well-known ...
0 votes
0 answers
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What are the effects of discount retailers on the suppliers' economics?

The ACTION retail store is very popular in Europe and usually provides good but cheap quality goods (as people say). The cheap prices are guaranteed that the bulk part of the store goods is made in ...
4 votes
2 answers
257 views

Why are production functions linear in technology?

Economists often assume a production function of the form $ Y = A f(K, L) $, where $Y$ is output, $K$ is capital, $L$ is labour and $A$ is technology. This form of production function can describe ...
1 vote
2 answers
86 views

Factoring Technology into Economics models

There has been tremendous improvement in technologies in recent years. My question is: have economists been able to properly evaluate and factor the values of recent innovations in the technology ...
3 votes
0 answers
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Neoclassical Growth Model with Technology Investment

I am reading Parente & Prescott 1994 JPE. This is just a typical neoclassical model with the extension of a global technology diffusion function and firm investment in technology. Firms have ...
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0 answers
25 views

Testing method for the performance of R&D support program

Suppose that Government aims to initiate R&D support program to firms The objective of the support program is to rise R&D expenditures and productivity. I have the following data variables: Q: ...
0 votes
1 answer
27 views

Can technological investments and advancements be used as monetary policy tool to fight high inflation (or its prospects)?

As of today (2021.12) inflation figures are high (the prospects are under discussions but risks of high inflation can be projected to the future as well) and monetary tightening is in the cards. That ...
1 vote
1 answer
35 views

Characterizing goods by R&D costs

Is there a name for distinguishing manufactured goods requiring little/no R&D and ones requiring high/sustained R&D costs? Do these two types of manufactured goods have a name in economics? ...
0 votes
1 answer
36 views

Basic question i guess

I'm not in economics, I'm actually studying sociology and I'm doing a subject about labor economics. I'm reading an article that talks about automation and says "The employment impact of ...
1 vote
1 answer
26 views

Is there contradiction between automation created resilience and the full employment (with high wages)?

From the one side - full employment with the high wages (but still under the level of creating inflation threat) is nice thing and politicians and central banks are highly motivated to achieve this. ...
3 votes
3 answers
275 views

Increasing returns, implications?

If a firm has increasing returns to scale (i.e., doubling inputs more than doubles output) would that firm logically end up being the sole firm in its sector in the long run? If not, what is the ...
0 votes
1 answer
52 views

Can demand side restrictions explain the productivity paradox (Solow paradox)?

Productivity paradox https://en.wikipedia.org/wiki/Productivity_paradox is the name for the slow productivity growth (i.e. slow GDP growth) of the developed economies despite the robotics, AI, ...
0 votes
1 answer
60 views

How much is currently invested in artificial general intelligence research and development?

Glossary: Artificial general intelligence (AGI) is the name given to an upcoming technology that would be able to solve all sorts of problems, like a human, and unlike more specialized existing ...
1 vote
1 answer
69 views

What is technology in the Ricardo model?

I've been reading about the Ricardo and Heckscher-Ohlin models. I'm having trouble following what makes a worker in the former able to produce more or less of a given good. So e.g. suppose a US worker ...
3 votes
1 answer
63 views

Would directing more money to science and research and development be an effective response to recessions?

Typical responses to recessions is to follow Keynesian economics and support demand. Would directing money towards science and research and development be a better long term solution to recessions ...
4 votes
1 answer
472 views

Difference between Value-Added TFP and Gross-Output TFP?

I am working with EU-KLEMS data, and I am using TFP growth as a proxy for technological change. However, there are 2 variables for TFP - TFP based on Gross Output and TFP based on Value Added. I ...
2 votes
2 answers
545 views

Why labor-augmenting technological progress increases employment and wages?

My textbook says that advances in technology typically raise the marginal product of labor and shift the labor demand curve to the right and calls it labor-augmenting technological advances. The book ...
4 votes
6 answers
611 views

Have automation and technological advance been shown to have a positive impact on society and the economy or a negative one?

My friends and I, 2 of which are computer science majors think it is worse because is humans can't work and thus afford necessities, how will they survive? The definition of automation: the use of ...
1 vote
1 answer
69 views

Define structural unemployment

I am a bit confused regarding the actual definition of structural unemployment. Some places say that it is the permanent decline of a particular industry, leading to workers being unemployed as they ...
3 votes
3 answers
643 views

Cobb-Douglas production function, given $w$ get $r$ regardless of input levels. Why?

There is a market economy with technology given by: $$Y = K^\alpha L^{1-\alpha} \tag{1}$$ Firms behave competitively and input prices are: $$r = \alpha K^{\alpha-1}L^{1-\alpha} = \alpha(\frac{L}{K})...
-1 votes
1 answer
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How do people check or trust that central bank is not cheating? [closed]

How people can be sure that somebody, cooperating with central bank (or working in it), is not creating money in digital or paper form for themself, so that nobody else notices it?
3 votes
4 answers
2k views

Why do companies launch products at much higher prices, only to reduce the price drastically after a few months?

I see this to be a prevalent trend - companies too often launch products at much higher prices than they know is gonna lead to good sales numbers, only to reduce the price drastically after a few ...
4 votes
2 answers
49 views

How do tech giants manage turnover costs?

Lately I was struck by different studies concluding median job tenure at Google, Facebook, Amazon, Microsoft and Apple is 1 to 2 years, very low compared to the Bureau of labor statistics which is a ...
3 votes
2 answers
47 views

Technological unemployment

I am doing a project on technological change in the job market, that is the substitution of routine occupations and increasing demand for high-skilled jobs. I have done some research on this and now I ...
0 votes
1 answer
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Understanding what's in the frequently reported and discussed high demand in IT specialists in Germany - is the IT Fachkräftemangel real?

So far, I can observe the following contradictory evidences what I perceive from the media. Statement group #1. In the press, there are repeated reports from different sources about missing ...
1 vote
2 answers
132 views

Productivity and wages in a task-based model

In a task-based model like the one developed in Acemoglu&Autor 2011 with two types of worker, can the low type have a higher wage with respect to the high type? More specifically: if the ...
2 votes
3 answers
761 views

Claiming that food delivery apps are purely rent extraction

I engaged in an argument with a friend about whether takeaway food ordering apps had any 'value'. I tried to persuade him that they were rent extraction enterprises but he wasn't convinced. So I want ...
2 votes
1 answer
92 views

Factor-augmenting technologies (Acemoglu and Restrepo 2018c)

In that paper, they consider the following production function: $Y = F(A_KK,A_LL)$. Where: K denotes capital, L is labor, and $A_K$ and $A_L$ denote capital-augmenting and labor-augmenting ...
1 vote
0 answers
29 views

How is labor demand measured?

For instance, in the introduction of this paper (first paragraph), talking about Figure 1, they say that labor demand is measured as the real wage bill normalized by population. Is it common to ...
1 vote
0 answers
236 views

Can one single payment contain multiple Merchant Category Codes (MCC)? [closed]

Some payment cards can be limited for certain purposes only (e.g. for paying only for food, or only for car fuel). When you try to pay for a different purpose, the system rejects the payment. I ...
6 votes
3 answers
2k views

Understanding Tertiarization of the Economy

Trying to understand some of the core mechanics of tertiarization in developed economies. According to the WorldBank, "As incomes continue to rise, people’s needs become less “material” and they ...
1 vote
3 answers
218 views

Why Is the West providing technology to India? [closed]

Previously, we have seen that Europeans and Americans provided various technologies (high-speed rail[1], aerospace[2][3], microprocessor[4], etc.) to China to earn instantaneous money. Later what ...
2 votes
0 answers
27 views

Understanding Boserup's theories on food and overpopulation

From what I understand about Boserup's theories, she claims that when populations grow and near the carrying capacity of whatever habitat they live in, businesses will have incentive to invest in new ...
2 votes
0 answers
82 views

Research community around logistics micro-economic topics?

Is there the equivalent of a Rand Journal of Economics for the topic of logistics, focusing on the micro-economics of productivity gains via automation or disruptive technologies. There is the ...
1 vote
3 answers
203 views

Do machines reduce labor... or so they redistribute, alter, and globally increase labor?

John Stuart Mill famously remarked that labor-saving machines have not saved one minute of labor. More seriously, Marx argued, roughly, that machines can gain temporary market advantage, but cannot ...
5 votes
4 answers
9k views

Labour Saving vs. Labour Augmenting - what is the difference?

It seems reasonable to say that technology generally increases output per unit of labour. Therefore in any factory which has installed new technology one can reasonably expect that for the same ...
2 votes
0 answers
53 views

Reference Request: Primer on Relationship Economic Growth and Science / Technology

I'm in the early stages of planning a research agenda in this area, which means studying the current literature with an eye for further research opportunities. The Economics of Science and ...
1 vote
2 answers
176 views

How technology will help economists to do better predictions?

Would technologies as AI, BI and Big Data help the economists to make better predictions and test models to solve problems like "What level of fiscal stimulus is better for a especific country?" Is ...
2 votes
2 answers
91 views

What does it mean for a technology to have a $|\rho|<1$?

Nowadays, when trying to model (log)technology $a_t$, I've seen many times the following: $a_t = \rho a_{t-1}+\epsilon$, where epsilon is given a certain probability distribution. What does it mean ...
2 votes
2 answers
2k views

Proxies for technological change in an economy?

I am writing a paper on the application of Value-Added TFP to measurement of technological change. Just thinking of throwing in a few variables into my regression. I have ICT capital share (as seen in ...
4 votes
2 answers
572 views

Is Artificial Intelligence a completely new (and underestimated) production factor?

Accenture research defines Artificial Intelligence as completely new production factor along labour and capital. Is such notion acceptable by economists? As far as I understand then every asset of AI ...
2 votes
1 answer
34 views

Energy saving technology and energy service price

I want to assess the effects of energy saving technologies on output growth using time series data. My work would benefit from time series data on patents for energy saving innovations, but this is ...