Abstract
This study demonstrates why traditional “cost-saving” technical progress fails in an economy where consumption is time-constrained. In such a case, introducing “time-saving” technical progress establishes a new consumption-production equilibrium characterized by higher per-capita consumption and real income, lower prices, and, a higher scale of production for surviving producers. Nonetheless, since there is a limit to how much time can be saved by technological advances, the model also suggests an alternative solution in the form of a rising labor force (say via immigration) to close the production-consumption gap. This solution generates an unambiguous increase in welfare, vis-à-vis cost-reducing or time-saving technical progress.
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Articles in the same Issue
- Frontmatter
- Research Articles
- Collusion, Shading, and Optimal Organization Design
- Software Cracking and Degrees of Software Protection
- The R&D Investment Decision Game with Product Differentiation
- An Urban Configuration with Online Competition
- Double Implementation in Dominant Strategy Equilibria and Ex-Post Equilibria with Private Values
- Risk Aversion and Uniqueness of Equilibrium in Economies with Two Goods and Arbitrary Endowments
- On Iterated Nash Bargaining Solutions
- Inter-league Competition and the Optimal Broadcasting Revenue-Sharing Rule
- The Weak Hybrid Equilibria of an Exchange Economy with a Continuum of Agents and Externalities
- Choosing Sides in a Two-Sided Matching Market
- Notes
- On the Relation between Private Information and Non-Fundamental Volatility
- Cost-Reducing Technologies and Labor Supply in a Krugman-type Model where Consumption is Time-Constrained: Some New Results
Articles in the same Issue
- Frontmatter
- Research Articles
- Collusion, Shading, and Optimal Organization Design
- Software Cracking and Degrees of Software Protection
- The R&D Investment Decision Game with Product Differentiation
- An Urban Configuration with Online Competition
- Double Implementation in Dominant Strategy Equilibria and Ex-Post Equilibria with Private Values
- Risk Aversion and Uniqueness of Equilibrium in Economies with Two Goods and Arbitrary Endowments
- On Iterated Nash Bargaining Solutions
- Inter-league Competition and the Optimal Broadcasting Revenue-Sharing Rule
- The Weak Hybrid Equilibria of an Exchange Economy with a Continuum of Agents and Externalities
- Choosing Sides in a Two-Sided Matching Market
- Notes
- On the Relation between Private Information and Non-Fundamental Volatility
- Cost-Reducing Technologies and Labor Supply in a Krugman-type Model where Consumption is Time-Constrained: Some New Results