Golden-Age Growth and Neutral Technical Progress
The aggregate economic relations that we have considered up to now have been looked at with a given ruling technique of production and without respect to their movement over time. Part of the process of looking at things in terms of comparisons implies making assumptions about past accumulation. Thus for each possible proportion of investment to consumption considered in the preceding exercises we also had to assume that the existing accumulation of capital in each sector was appropriate to the labour force employed in that sector. A simple increase in employment in one sector will change very little unless the appropriate capital equipment for the extra labour to work with is also provided. This is what we mean by looking at systems, each with his own past record of accumulation and its own prospects of the future. The systems have had enough time to digest, so to speak, any large shifts or changes in conditions.
KeywordsLabour Force Capital Stock Real Wage Technical Progress Capital Good
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