Specialization, Information, and Growth: A Sequential Equilibrium Analysis
AbstractPricing costs and information problems are introduced into a framework with consumer-producers, economies of specialization, and transaction costs to predict the endogenous and concurrent evolution in division of labor and in the information of organization acquired by society. The concurrent evolution generates endogenous growth based on the tradeoff between gains from information about the efficient pattern of division of labor, which can be acquired via experiments with various patterns of division of labor, and experimentation costs, which relate to the costs in discovering prices. The concept of Walras sequential equilibrium is developed to analyze the social learning process which is featured with uncertainties of the direction of the evolution as well as a certain trend of the evolution.
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Bibliographic InfoPaper provided by Center for International Development at Harvard University in its series CID Working Papers with number 7.
Date of creation: Mar 1999
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Coevolution of specialization and information; adaptive decision; bounded rationality; sequential equilibrium; economic development.;
Other versions of this item:
- Ng, Yew-Kwang & Yang, Xiaokai, 1997. "Specialization, Information, and Growth: A Sequential Equilibrium Analysis," Review of Development Economics, Wiley Blackwell, vol. 1(3), pages 257-74, October.
- Ng, Y.K. & Yang, X., 1999. "Specialization, Information, and Growth: A Sequential Equilibrium Analysis," Papers 7, Chicago - Graduate School of Business.
- D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
- D50 - Microeconomics - - General Equilibrium and Disequilibrium - - - General
- D90 - Microeconomics - - Intertemporal Choice - - - General
- O12 - Economic Development, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
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