Information Transmission and the Bounds to Growth
Journal
The B.E. Journal of Economic Analysis & Policy
ISSN
1538-0637
ISSN-Digital
1538-0629
Type
journal article
Date Issued
2004-03-18
Author(s)
Abstract
This paper studies the long run growth implications of the presence of information acquisition and transmission costs. We assume that vertical innovation requires researchers to be informed on the current version of the product they want to improve upon; and we also assume that quasi-fixed managerial inputs are required for production in the manufacturing sector. Despite the fact the increases in total factor productivity cause R&D and managerial quasi-fixed labor costs to decrease in the same way as variable labor costs, the presence of these costs is sufficient to rule out the strong scale effect at all levels of the intertemporal returns to ideas. More importantly, the upper bound of long run growth rates crucially depends on information transmission costs.
Language
English
HSG Classification
contribution to scientific community
HSG Profile Area
SEPS - Economic Policy
Refereed
Yes
Publisher
Berkeley Electronic Press
Volume
4
Number
1
Start page
6
End page
6
Pages
1
Subject(s)
Eprints ID
222081