English, Article, Journal or magazine article edition: A Quantitative Study of the Replacement Problem in Frictional Economies Gianluca Violante; Andreas Hornstein; Per Krusell

User activity

Share to:
 
Bookmark: http://trove.nla.gov.au/version/57327
Physical Description
  • preprint
Language
  • English

Edition details

Title
  • A Quantitative Study of the Replacement Problem in Frictional Economies
Author
  • Gianluca Violante
  • Andreas Hornstein
  • Per Krusell
Physical Description
  • preprint
Notes
  • The question of how technological change affects labor markets is a classical one in macroeconomics. A standard framework for addressing this question is the matching model with vintage capital and exogenous technical progress. Within this framework, it has been argued that the impact of technological change on labor market outcomes differs according to the mechanism through which the new technology enters the economy. In particular, it matters whether: (1) new capital replaces old capital by destroying the job and displacing the worker (Schumpeterian creative-destruction) or old capital can be "upgraded" to the frontier technology (Solowian upgrading); (2) firms make the technology adoption decision unilaterally (hold-up), or the investment decision is surplus-maximizing (efficient investment). Our main finding is that for quantitatively reasonable parameter values the specific details of the model for how technology is introduced and who decides on investments do not matter for the equilibrium outcomes of our main variables of interest: unemployment, wage inequality, and labor share. The intuition for this "equivalence result" is that these models will yield significantly different implications only if the matching process is very costly and time-consuming, but our calibration shows that this meeting friction is minor
  • investment-specific technical change, directed technical change, skill premium
  • RePEc:red:sed004:64
Language
  • English
Contributed by
OAIster

Get this edition

Other links

  • Set up My libraries

    How do I set up "My libraries"?

    In order to set up a list of libraries that you have access to, you must first login or sign up. Then set up a personal list of libraries from your profile page by clicking on your user name at the top right of any screen.

  • All (1)
  • Unknown (1)
None of your libraries hold this item.
None of your libraries hold this item.
None of your libraries hold this item.
None of your libraries hold this item.
None of your libraries hold this item.
None of your libraries hold this item.
None of your libraries hold this item.
None of your libraries hold this item.

User activity


e.g. test cricket, Perth (WA), "Parkes, Henry"

Separate different tags with a comma. To include a comma in your tag, surround the tag with double quotes.

Be the first to add a tag for this edition

Be the first to add this to a list

Comments and reviews

What are comments? Add a comment

No user comments or reviews for this version

Add a comment