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Technical Change, Uncertainty, and Investment
Author(s) -
Stefanou Spiro E.
Publication year - 1987
Publication title -
american journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.949
H-Index - 111
eISSN - 1467-8276
pISSN - 0002-9092
DOI - 10.2307/1241317
Subject(s) - technical change , economics , investment (military) , wage , stock (firearms) , microeconomics , investment decisions , technical analysis , econometrics , technical progress , financial economics , labour economics , macroeconomics , production (economics) , productivity , mechanical engineering , politics , political science , law , engineering
The expected investment dynamics of the risk‐neutral firm is examined in the presence of uncertainty in the future evolution of the real wage and the stock of technical knowledge. A model of the adjustment cost firm is developed that is characterized by quasi‐fixed, factor‐augmenting technical change that is taken exogenously by the firm. The effect of wage and technical change uncertainty on investment behavior is assessed using comparative stochastic dynamic analysis.