Technological Progress and Regress in Pre-Industrial Times
Shekhar S. Aiyar
International Monetary Fund (IMF)
University of Copenhagen - Department of Economics
University of Warwick - Department of Economics; Hebrew University of Jerusalem - Department of Economics; Centre for Economic Policy Research (CEPR)
Journal of Economical Growth, Vol. 13, No. 2, 2008
This paper offers micro-foundations for the dynamic relationship between technology and population in the pre-industrial world, accounting for both technological progress and the hitherto neglected but common phenomenon of technological regress. A growing population engenders the endogenous adoption of new techniques that increase the division of labor. Coversely, technological progress supports an increasing population in the Malthusian environment. A transient shock to population or productivity, however, induces the neglect of some techniques rendered temporarily unprofitable, which are therefore not transmitted to the next generation. When the shock passes, the division of labor remains constrained by the smaller stock of knowledge, and technology has thereby regressed. A slow process of rediscovery is required for the economy to reach its previous level of technological sophistication and population size. The model is employed to analyze specific historical examples of technological regress.
Number of Pages in PDF File: 24
Keywords: Technological Regress, Technological Progress, Malthusian Stagnation, Division of Labor
JEL Classification: O10, O33, O40, J11Accepted Paper Series
Date posted: December 15, 2005
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