Escaping Satiation in an Evolutionary Model of Structural Economic Dynamics
This paper presents the problem of satiation in relation to a model of evolutionary endogenous growth. The model represents an attempt to provide an evolutionary economic micro foundation to Pasinetti's scheme of the structural economic dynamics of a labour economy. Like this scheme the model deals with an economic system with a varying number of sectors, each of which is producing a consumption good. The goods are produced within consumer-producer firms which organise both production and consumption for their workers. Through innovative activities firms increase their productivity with respect to individual goods. The long-run consequence of this is that labour becomes available for the production of new consumption goods. If such goods are not provided to a sufficient degree, "technological unemployment" will emerge. If there is slow productivity development in the production of new goods, the overall rate of growth will slow down irrespectively of productivity growth in old sectors. Thus, to enhance long-term growth there is a need of "anticipatory R&D", i.e. R&D which produces designs for novel consumption goods and increases productivity in the production of these goods.
|Date of creation:||1998|
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- Esben Sloth Andersen & Anne K. Jensen & Lars Madsen & Martin Jørgensen, 1996. "The Nelson and Winter Models RevisitedPrototypes for Computer-Based Reconstruction of Schumpeterian Competition," DRUID Working Papers 96-5, DRUID, Copenhagen Business School, Department of Industrial Economics and Strategy/Aalborg University, Department of Business Studies.
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- Richard R. Nelson, 1995. "Recent Evolutionary Theorizing about Economic Change," Journal of Economic Literature, American Economic Association, vol. 33(1), pages 48-90, March.
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