Monday, March 19, 2018

A Reswitching Pattern With A Continuum Of Techniques

Recurrence Of Techniques Without Switch Points

I have built on my previous post in a writeup:

Abstract: In certain models of commodities produced by means of commodities, the choice of technique is analyzed by the construction of the wage frontier. This article presents a numeric example of a continuum of wage curves tangent at a switch point. Technological progress leads to the recurrence of techniques. No switch points then exist, but the cost-minimizing technique varies continuously along the wage frontier. Further progress leads to the disappearance of the recurrence of techniques and, eventually, a single technique becoming cost-minimizing for all feasible rates of profits.

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