tag:blogger.com,1999:blog-26706564.post3134694107489292303..comments2024-03-25T07:51:47.758-04:00Comments on Thoughts On Economics: Choice Of Technique With A Smooth Aggregate Production FunctionRobert Vienneauhttp://www.blogger.com/profile/14748118392842775431noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-26706564.post-46235972275635526742013-04-24T18:01:03.510-04:002013-04-24T18:01:03.510-04:00Thanks for the comment.
I certainly know of at le...Thanks for the comment.<br /><br />I certainly know of at least one theorem that does not apply to discrete technologies. But I hope to show (or at least explore) the claim that the divide is not that sharp.<br /><br />Solow also mistakenly claimed that every point in a model like this must be a switch point. But, if that is so, you should be able to provide more than one set of cost-minimizing coefficients of production at each point.Robert Vienneauhttps://www.blogger.com/profile/00872510108133281526noreply@blogger.comtag:blogger.com,1999:blog-26706564.post-8641551692367220252013-04-22T09:07:00.730-04:002013-04-22T09:07:00.730-04:00It is indeed an elegant model! Two comments: (1) d...It is indeed an elegant model! Two comments: (1) discrete techniques influence the behaviour of the system. A switch to another technique leads to significant changes in the quantities of production factors. This causes shocks in the economic structure. It is a source of instability. For the enterprises, the shocks create uncertainty, which makes them reluctant to perform the switch. (2) I would think that each point on the frontier must be a switch point. Otherwise it would be impossible to switch. The continuous curve would be the hull of the frontier, and is never a frontier itself. Therefore it seems that dw/ds does not exist on the frontier (consisting of switch points). I admit that this is strange, because in the limit all switch points would coincide.Emil Bakkumhttp://www.hgdewolff.nlnoreply@blogger.com