Organizational Capital, Learning-by-Doing and Investment Volatility
This paper addresses the issue of plant-level investment volatility in the context of a purely convex model, where fluctuations are driven by technological shocks. The aim is to assess the role of learning-by-doing in reproducing the well-documented non-smooth investment dynamics at the plant-level, instead of relying on typical non-convexities (fixed costs or indivisibilities) used to account for lumpy investment behavior. The concept of organizational capital is essential in the analysis, and it provides the channel through which learning affects production. Our results indicate that learning-by-doing constitutes a potentially important source of investment volatility at the plant-level, and that one should not believe that convex models of investment necessarily deliver smooth dynamics.
Volume (Year): 8 (2007)
Issue (Month): 3 ()
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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- C. Lanier Benkard, 2000. "Learning and Forgetting: The Dynamics of Aircraft Production," American Economic Review, American Economic Association, vol. 90(4), pages 1034-1054, September.
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- repec:oup:restud:v:73:y:2006:i:3:p:611-633 is not listed on IDEAS
- Russell W. Cooper & John C. Haltiwanger, 2000.
"On the Nature of Capital Adjustment Costs,"
NBER Working Papers
7925, National Bureau of Economic Research, Inc.
- Boyan Jovanovic & Yaw Nyarko, 1994.
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NBER Working Papers
4739, National Bureau of Economic Research, Inc.
- Sherwin Rosen, 1972. "Learning by Experience as Joint Production," The Quarterly Journal of Economics, Oxford University Press, vol. 86(3), pages 366-382.
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