The coronavirus epidemic has instigated an economic crisis emanating from public health policies involving economic lockdown as well as behavioral reactions of workers and employers. The developed world has not seen such an extent of economic damage since at least the Second World War. We...

Acemoglu’s (2003) paper “Labor- and Capital-augmenting Technical Change” is a pioneering work that introduces a growth model with an endogenous direction of technical progress including microfoundations. At the steady-state equilibrium, the model indicates that there is only net...

This note demonstrates that it is easily possible to compute technological parameters out ot national income acconting data in the presence of bargaining in the labor market. Applying the method to US data, we obtain that the output elasticity with respect to capital exceed 0.5.

We use a static framework characterized by both moral hazard and holdup problems. In the model the optimal allocation of bargaining power balances these frictions. We examine the impact of improved monitoring on that optimal allocation and its impact upon effort, investment, profits and rents....

Based on a general growth model, this paper finds that the steady-state direction of technological progress is determined by the scale return of the production function and the relative factor supply elasticities. A specific version of that model extends Acemoglu (2002) to provide the underlying...

In a classic paper, Acemoglu (2003) developed a growth model where firms can undertake both labor- and capital-augmenting technological improvements. According to that paper the balanced growth path with purely labor-augmenting technical change is the unique asymptotic (noncycling) equilibrium,...

The history of modern economic growth indicates that technical change is not only purely labor-augmenting, but also skill biased the 20th century. Although there are papers that have separately analyzed why technical change be purely labor-augmenting or skill biased, there is no paper analyzing...

The neoclassical Euler equation provides the necessary conditions for households to maximize lifetime utility by allocating income between consumption and investment, and is the core equation for solving the steady-state of the neoclassical growth model. The existing textbooks (Barro and...

Technological progress relates not only to its rate but also to its direction and bias. The rate has been analyzed by the endogenous technical change models and the bias has been analyzed by the directed technical change model, but the determinants of the direction has not been uncovered yet....