Friday, July 19, 2019

Harrod-Neutral Technical Progress and Fluke Switch Points

Figure 1: A Pattern Diagram

I have put up a working paper with the post title.

Abstract: This article considers Harrod-neutral technical progress in the context of an analysis of the choice of technique. In a model of the production of commodities by means of commodities, neutral technical change is compatible with the reswitching of techniques, capital reversing, process recurrence, and the reverse substitution of labor. A taxonomy of fluke switch points is applied to an example, illustrating how these phenomena can arise and vanish in the course of neutral technical progress.

I get various fluke switch points, as is typical of my examples. By assuming Harrod-neutral technical change, I end up with the structure in Figure 2, in one slice of the parameter space.

Figure 2: A Two-Dimensional Pattern Diagram

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