Heterogenous Productivity and Specialization in an Equilibrium Search Model
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This paper presents a fixed price search‐theoretic model of bilateral exchanges in which individuals with heterogeneous productivity costly extend their production set in order to study endogenous specialization. It investigates how changes in production technology and the use of money affect the equilibrium degree of specialization. The key message of the findings about the relationship between specialization and productivity, is that, if technology progress lowers down the marginal costs in production for every good, it is necessary to take changes in total variety of goods into account for the positive relationship between two. In the matter of the relationship between specialization and the use of money, the results of this study support the positive relationship between two. In addition, they also show that introducing money makes it easier for technology progress to facilitate specialization compared with barter.
Abstract
This paper presents a fixed price search‐theoretic model of bilateral exchanges in which individuals with heterogeneous productivity costly extend their production set in order to study endogenous specialization. It investigates how changes in production technology and the use of money affect the equilibrium degree of specialization. The key message of the findings about the relationship between specialization and productivity, is that, if technology progress lowers down the marginal costs in production for every good, it is necessary to take changes in total variety of goods into account for the positive relationship between two. In the matter of the relationship between specialization and the use of money, the results of this study support the positive relationship between two. In addition, they also show that introducing money makes it easier for technology progress to facilitate specialization compared with barter.
참고문헌 (19)
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