IDEAS home Printed from https://ideas.repec.org/p/sgc/wpaper/21.html
   My bibliography  Save this paper

The Cyclical Advancement of Drastic Technologies

Author

Listed:
  • I. Hakan Yetkiner
  • Albert de Vaal
  • Adriaan van Zon

Abstract

Drastic technological changes are cyclical because basic R&D is carried on only at times when entrepreneurial profits for incremental technologies of the prevailing technological paradigm fall close to zero. The model is essentially an endogenous technological change framework. Varieties, input to the final good production, are composite goods. Each composite good is produced by a set of intermediaries, outgrowths of basic R&D and applied R&D. The basic intermediate, product of basic R&D, is modeled as in Romer (1990). Complementary intermediates, the outgrowths of applied R&D, do show the property of falling profits. The falling character of profits implies that basic R&D becomes more yielding than applied R&D at certain points in time. Research people switch back and forth between the applied and basic research sectors, creating (endogenous) cycles in the advancement of drastic technologies and economic activity.

Suggested Citation

  • I. Hakan Yetkiner & Albert de Vaal & Adriaan van Zon, 2003. "The Cyclical Advancement of Drastic Technologies," Working Papers FNU-21, Research unit Sustainability and Global Change, Hamburg University, revised Apr 2003.
    • Handle: RePEc:sgc:wpaper:21
    as

    Download full text from publisher

    File URL: http://www.fnu.zmaw.de/fileadmin/fnu-files/publication/working-papers/GPT.pdf
    File Function: First version, 2003
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Bresnahan, Timothy F. & Trajtenberg, M., 1995. "General purpose technologies 'Engines of growth'?," Journal of Econometrics, Elsevier, vol. 65(1), pages 83-108, January.
    2. Claudia Kemfert & Wietze Lise & Richard Tol, 2004. "Games of Climate Change with International Trade," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 28(2), pages 209-232, June.
    3. Aghion, Philippe & Howitt, Peter, 1992. "A Model of Growth through Creative Destruction," Econometrica, Econometric Society, vol. 60(2), pages 323-351, March.
    4. Richard S.J. Tol, 2002. "Technology Protocols For Climate Change: An Application Of Fund," Working Papers FNU-14, Research unit Sustainability and Global Change, Hamburg University, revised Sep 2002.
    5. Robert M. Solow, 1956. "A Contribution to the Theory of Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 70(1), pages 65-94.
    6. Tol, Richard S.J., 2005. "Emission abatement versus development as strategies to reduce vulnerability to climate change: an application of FUND," Environment and Development Economics, Cambridge University Press, vol. 10(5), pages 615-629, October.
    7. Robert J. Gordon, 2000. "Does the "New Economy" Measure Up to the Great Inventions of the Past?," Journal of Economic Perspectives, American Economic Association, vol. 14(4), pages 49-74, Fall.
    8. Heng-Chi Lee & Bruce McCarl & Uwe Schneider & Chi-Chung Chen, 2007. "Leakage and Comparative Advantage Implications of Agricultural Participation in Greenhouse Gas Emission Mitigation," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 12(4), pages 471-494, May.
    9. van Zon, Adriaan & Yetkiner, I. Hakan, 2003. "An endogenous growth model with embodied energy-saving technical change," Resource and Energy Economics, Elsevier, vol. 25(1), pages 81-103, February.
    10. Schneider, Uwe A. & McCarl, Bruce A., 2005. "Implications of a Carbon-Based Energy Tax for U.S. Agriculture," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 34(2), pages 1-15, October.
    11. Katrin Rehdanz & Richard S.J. Tol, 2002. "On National and International Trade in Greenhouse Gas Emission Permits," Working Papers FNU-11, Research unit Sustainability and Global Change, Hamburg University, revised Jan 2003.
    12. Katrin Rehdanz, 2002. "Hedonic Pricing Of Climate Change Impacts To Households In Great Britain," Working Papers FNU-13, Research unit Sustainability and Global Change, Hamburg University, revised Jul 2002.
    13. Gary W. Yohe & Richard S.J. Tol, 2001. "Indicators for Social and Economic Coping Capacity – Moving Toward at Working Definition of Adaptive Capacity," Working Papers FNU-8, Research unit Sustainability and Global Change, Hamburg University, revised Jun 2001.
    14. Jacqueline M. Hamilton, 2002. "Climate and the Destination Choice of German Tourists," Working Papers FNU-15, Research unit Sustainability and Global Change, Hamburg University, revised Aug 2003.
    15. Romer, Paul M, 1990. "Endogenous Technological Change," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 71-102, October.
    16. Claudia Kemfert & Richard Tol, 2002. "Equity, international trade and climate policy," International Environmental Agreements: Politics, Law and Economics, Springer, vol. 2(1), pages 23-48, March.
    17. Alfred Kleinknecht, 1987. "Innovation Patterns in Crisis and Prosperity," Palgrave Macmillan Books, Palgrave Macmillan, number 978-1-349-18559-7, March.
    18. Richard S.J. Tol & Wietze Lise & Benoit Morel & Bob C.C. van der Zwaan, 2001. "Technology Development And Diffusion And Incentives To Abate Greenhouse Gas Emissions," Working Papers FNU-6, Research unit Sustainability and Global Change, Hamburg University, revised Feb 2001.
    19. David, Paul A, 1990. "The Dynamo and the Computer: An Historical Perspective on the Modern Productivity Paradox," American Economic Review, American Economic Association, vol. 80(2), pages 355-361, May.
    20. Richard S.J. Tol & Thomas E. Downing & Samuel Fankhauser & Richard G. Richels & Joel B. Smith, 2001. "Progress In Estimating The Marginal Costs Of Greenhouse Gas Emissions," Working Papers FNU-4, Research unit Sustainability and Global Change, Hamburg University, revised Jan 2001.
    21. Zon, Adriaan van & Yetkiner, I. Hakan, 2001. "An Endogenous Growth Model à la Romer with Embodied Energy-Saving Technological Change," Research Memorandum 031, Maastricht University, Maastricht Economic Research Institute on Innovation and Technology (MERIT).
    22. Olsson, Ola, 2001. "Why Does Technology Advance in Cycles?," Working Papers in Economics 38, University of Gothenburg, Department of Economics.
    23. Richard S.J. Tol & Samuel Fankhauser & Richard G. Richels & Joel B. Smith, 2000. "How Much Damage Will Climate Change Do? Recent Estimates," Working Papers FNU-2, Research unit Sustainability and Global Change, Hamburg University, revised Sep 2000.
    24. Richard S.J. Tol & Samuel Fankhauser & Richard G. Richels & Joel B. Smith, 2000. "How Much Damage Will Climate Change Do?," World Economics, World Economics, 1 Ivory Square, Plantation Wharf, London, United Kingdom, SW11 3UE, vol. 1(4), pages 179-206, October.
    25. Richard S.J. Tol & Roda Verheyen, 2001. "Liability And Compensation For Climate Change Damages – A Legal And Economic Assessment," Working Papers FNU-9, Research unit Sustainability and Global Change, Hamburg University, revised Sep 2001.
    26. Richard S.J. Tol, 2003. "The Marginal Costs Of Carbon Dioxide Emissions: An Assessment Of The Uncertainties," Working Papers FNU-19, Research unit Sustainability and Global Change, Hamburg University, revised Apr 2003.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. I. Hakan Yetkiner, 2003. "Is There An Indispensable Role For Government During Recovery From An Earthquake? A Theoretical Elaboration," Working Papers FNU-25, Research unit Sustainability and Global Change, Hamburg University, revised Apr 2003.
    2. P. Michael Link, 2003. "Auswirkungen populationsdynamischer Veränderungen in Fischbeständen auf die Fischereiwirtschaft in der Barentssee," Working Papers FNU-29, Research unit Sustainability and Global Change, Hamburg University, revised May 2003.
    3. Roberto Roson & Richard s.J. Tol, 2003. "An Integrated Assessment Model Of Economy-Energy-Climate – The Model Wiagem: A Comment," Working Papers FNU-26, Research unit Sustainability and Global Change, Hamburg University, revised May 2003.
    4. Dritan Osmani, "undated". "A note on optimal transfer schemes, stable coalition for environmental protection and joint maximization assumption," Working Papers FNU-176, Research unit Sustainability and Global Change, Hamburg University.
    5. Zon, Adriaan van & Fortune, Emmanuelle & Kronenberg, Tobias, 2003. "How to Sow and Reap as You Go: a Simple Model of Cyclical Endogenous Growth," Research Memorandum 029, Maastricht University, Maastricht Economic Research Institute on Innovation and Technology (MERIT).
    6. Olsson, Ola, 2001. "Why Does Technology Advance in Cycles?," Working Papers in Economics 38, University of Gothenburg, Department of Economics.
    7. Gros, Daniel & Alcidi, Cinzia, 2014. "The Global Economy in 2030: Trends and Strategies for Europe," CEPS Papers 9142, Centre for European Policy Studies.
    8. Md Shahiduzzaman & Allan Layton & Khorshed Alam, 2015. "On the contribution of information and communication technology to productivity growth in Australia," Economic Change and Restructuring, Springer, vol. 48(3), pages 281-304, November.
    9. Antonin Bergeaud & Gilbert Cette & Rémy Lecat, 2016. "Productivity Trends in Advanced Countries between 1890 and 2012," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 62(3), pages 420-444, September.
    10. Gunnarsson, Gudmundur & Mellander, Erik & Savvidou, Eleni, 2004. "Human capital is the key to the IT productivity paradox," Working Paper Series 2004:13, IFAU - Institute for Evaluation of Labour Market and Education Policy.
    11. Sang-Yong Tom Lee & Xiao Jia Guo, 2004. "Information and Communications Technology (ICT) and Spillover: A Panel Analysis," Econometric Society 2004 Far Eastern Meetings 722, Econometric Society.
    12. repec:dgr:rugccs:200217 is not listed on IDEAS
    13. Les T. Oxley & Kenneth I. Carlaw, 2004. "ICT Diffusion and Economic Growth in New Zealand," Econometric Society 2004 Australasian Meetings 167, Econometric Society.
    14. Nadine Fabritz, 2015. "Investment in ICT: Determinants and Economic Implications," ifo Beiträge zur Wirtschaftsforschung, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, number 60.
    15. Jeon, Heesang, 2015. "Knowledge and Contemporary Capitalism in Light of Marx's Value Theory," Thesis Commons g5njk, Center for Open Science.
    16. Szalavetz, Andrea, 2011. "Innovációvezérelt növekedés? [Innovation-driven growth?]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(5), pages 460-476.
    17. Ricci, Francesco, 2007. "Channels of transmission of environmental policy to economic growth: A survey of the theory," Ecological Economics, Elsevier, vol. 60(4), pages 688-699, February.
    18. Mauro Napoletano & Andrea Roventini & Sandro Sapio, 2004. "Yeast vs. Mushrooms: A Note on Harberger's "A Vision of the Growth Process"," LEM Papers Series 2004/03, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    19. Paul David & Gavin Wright, 1999. "Early Twentieth Century Productivity Growth Dynamics: An Inquiry into the Economic History of Our Ignorance," Oxford Economic and Social History Working Papers _033, University of Oxford, Department of Economics.
    20. Kemnitz, Alexander & Knoblach, Michael, 2020. "Endogenous sigma-augmenting technological change: An R&D-based approach," CEPIE Working Papers 02/20, Technische Universität Dresden, Center of Public and International Economics (CEPIE).
    21. Fankhauser, Samuel & S.J. Tol, Richard, 2005. "On climate change and economic growth," Resource and Energy Economics, Elsevier, vol. 27(1), pages 1-17, January.

    More about this item

    Keywords

    GPT; growth cycles; basic R&D; applied R&D; economic growth;
    All these keywords.

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sgc:wpaper:21. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Uwe Schneider (email available below). General contact details of provider: https://edirc.repec.org/data/zmhamde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.