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Economic Development, variety and employment

Author

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  • Paolo Saviotti

    (INRA, Université Pierre Mendés-France and IDEFI, CNRS, Sophia Antipolis,)

  • Andreas Pyka

    (Economics Department, University of Augsburg)

Abstract

This paper studies qualitative change taking place during economic development. In the model presented qualitative change is created by the mergence of new sectors, each of which produces an output that is different from other sectors. A system with a variable number of sectors is simulated. The model predicts that under given conditions the evolution of a sector tends to follow a life cycle in both the number of firms and in terms of employment. The cyclical behavior is determined by the balance between the increasing intensity of competition, saturating demand and increasing retuns to adoption. In its present form the model is a simplified representation of the economic system, but several improvements can be introduced in order to increase its degree of realism.

Suggested Citation

  • Paolo Saviotti & Andreas Pyka, 2003. "Economic Development, variety and employment," Working Papers geewp35, Vienna University of Economics and Business Research Group: Growth and Employment in Europe: Sustainability and Competitiveness.
    • Handle: RePEc:wiw:wiwgee:geewp35
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    References listed on IDEAS

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    Cited by:

    1. Freire Junior, Clovis, 2017. "Promoting structural transformation: Strategic diversification vs laissez-faire approach," MERIT Working Papers 2017-037, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    2. Frank Oort & Johan Oud & Otto Raspe, 2009. "The urban knowledge economy and employment growth: a spatial structural equation modeling approach," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 43(4), pages 859-877, December.
    3. Fritsch, Michael, 2013. "New Business Formation and Regional Development: A Survey and Assessment of the Evidence," Foundations and Trends(R) in Entrepreneurship, now publishers, vol. 9(3), pages 249-364, February.
    4. Attila Varga, 2017. "Place-based, Spatially Blind, or Both? Challenges in Estimating the Impacts of Modern Development Policies," International Regional Science Review, , vol. 40(1), pages 12-37, January.
    5. Cristiano Antonelli & Morris Teubal, 2012. "From the Corporation to Venture Capitalism: New Surrogate Markets for Knowledge and Innovation Led Economic Growth," Chapters, in: Michael Dietrich & Jackie Krafft (ed.), Handbook on the Economics and Theory of the Firm, chapter 38, Edward Elgar Publishing.
    6. Salvatore Corrente & Salvatore Greco & Melita Nicotra & Marco Romano & Carmela Elita Schillaci, 2019. "Evaluating and comparing entrepreneurial ecosystems using SMAA and SMAA-S," The Journal of Technology Transfer, Springer, vol. 44(2), pages 485-519, April.
    7. Michael Fritsch & Florian Noseleit, 2009. "Start-ups, Long- and Short-Term Survivors and their Effect on Regional Employment Growth," Jena Economics Research Papers 2009-081, Friedrich-Schiller-University Jena.
    8. Cimoli, Mario & Fleitas, Sebastian & Porcile, Gabriel, 2011. "Real Exchange Rate and the Structure of Exports," MPRA Paper 37846, University Library of Munich, Germany.
    9. Attila Varga, 2014. "Challenges in modeling the impacts of modern development policies: The case of the GMR-approach," EcoMod2014 7151, EcoMod.
    10. Cristiano Antonelli & Morris Teubal, 2010. "Venture Capitalism as a Mechanism for Knowledge Governance," Chapters, in: Riccardo Viale & Henry Etzkowitz (ed.), The Capitalization of Knowledge, chapter 3, Edward Elgar Publishing.
    11. Arup Mitra & Amit Jha, 2015. "Innovation and employment: a firm level study of Indian industries," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 5(1), pages 45-71, June.
    12. Varga, Attila, 2020. "A tudástermelési függvénytől a fejlesztéspolitikai hatáselemzésig [From the knowledge production function to development policy-impact modelling]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(6), pages 537-556.
    13. Cristiano Antonelli & Morris Teubal, 2009. "Venture Capitalism, New Markets and Innovation-led Economic Growth," ICER Working Papers 03-2009, ICER - International Centre for Economic Research.
    14. Michael Fritsch, 2011. "The effect of new business formation on regional development - Empirical evidence, interpretation, and avenues for further research," Jena Economics Research Papers 2011-006, Friedrich-Schiller-University Jena.
    15. Melita Nicotra & Marco Romano & Manlio Giudice & Carmela Elita Schillaci, 2018. "The causal relation between entrepreneurial ecosystem and productive entrepreneurship: a measurement framework," The Journal of Technology Transfer, Springer, vol. 43(3), pages 640-673, June.
    16. repec:elg:eechap:14395_15 is not listed on IDEAS
    17. Costa, Leopoldo & Teixeira, Joanilio Rodolpho, 2018. "Structural change with different consumption profiles in a pure labour economy," Structural Change and Economic Dynamics, Elsevier, vol. 47(C), pages 28-34.
    18. Kurt Dopfer, 2016. "Evolutionary economics," Chapters, in: Gilbert Faccarello & Heinz D. Kurz (ed.), Handbook on the History of Economic Analysis Volume III, chapter 14, pages 175-193, Edward Elgar Publishing.
    19. Saviotti, Pier Paolo & Pyka, Andreas, 2013. "From necessities to imaginary worlds: Structural change, product quality and economic development," Technological Forecasting and Social Change, Elsevier, vol. 80(8), pages 1499-1512.
    20. Michael Fritsch, 2012. "Methods of analyzing the relationship between new business formation and regional development," Jena Economics Research Papers 2012-064, Friedrich-Schiller-University Jena.
    21. Ugur, Mehmet & Mitra, Arup, 2014. "Effects of innovation on employment in low-income countries: A mixed-method systematic review," MPRA Paper 58214, University Library of Munich, Germany, revised 27 Aug 2014.
    22. Koen Frenken & Frank G. van Oort & Thijs Verburg & Ron A. Boschma, 2004. "Variety and regional economic growth in the Netherlands," Papers in Evolutionary Economic Geography (PEEG) 0502, Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography, revised Dec 2004.

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    Keywords

    economic development; employment; multisectoral model;
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