Learning by Observation Within the Firm
AbstractThis paper studies the effects of learning by observation on the production and wage decisions of a firm . Workers can improve their productivity by observing others within the firm. The firm chooses a wage profile, which determines the amount of research done within the firm. Some workers may choose to free ride on the research of others. We examine whether the firm will have increasing returns to scale in production. It turns out that the production function either satisfies the efficiency wage hypothesis, or has increasing returns to scale. The objectives of the firm determine which of the two regions its production schedule lies in.
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Bibliographic InfoPaper provided by Department of Economics, Florida State University in its series Working Papers with number 1993_07_03.
Length: 32 pages
Date of creation: 1993
Date of revision:
Other versions of this item:
- Dutta, J. & Prasad, K., 1993. "Learning by Observation within the Firm," Papers 187, Cambridge - Risk, Information & Quantity Signals.
- DUTTA, Jayasri & PRASAD, Kislaya, 1993. "Learning by Observation within the Firm," CORE Discussion Papers 1993026, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- D2 - Microeconomics - - Production and Organizations
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