Are All Technological Improvements Beneficial? Absolutely Not

39 Pages Posted: 20 Jun 2013

See all articles by Yochanan Shachmurove

Yochanan Shachmurove

City University of New York, CUNY City College of New York - Department of Economics; The University of Pennsylvania - Department of Economics

Uriel Spiegel

Bar-Ilan University - Department of Management

Date Written: June 19, 2013

Abstract

This paper shows, using a simple model, that wasteful innovations may result in a loss-loss situation where no country experiences an increase in welfare. If some countries introduce innovations that result in harmful effects on other countries, it may cause the adversely affected countries to retaliate by imposing impediments to international trade. In a globalized and integrated World economy, such policies can only harm the countries involved. Thus, it is in both countries' best interest to encourage sustainable coordination between policies in order to better their own citizens, as well as the World's aggregate welfare.

Keywords: International Trade, Samuelson, Gainers and Losers from Trade, Technological Improvements, Concealed Technological Improvements, Pareto Improvements in Production and Consumption, Nash Bargaining Process, Sleeping Patents, Rest of the World, Terms of Trade, Distributive Justice, China, United States

JEL Classification: F0, F1, O1, O3, D51

Suggested Citation

Shachmurove, Yochanan and Spiegel, Uriel, Are All Technological Improvements Beneficial? Absolutely Not (June 19, 2013). PIER Working Paper No. 13-027. Available at SSRN: https://ssrn.com/abstract=2281858 or http://dx.doi.org/10.2139/ssrn.2281858

Yochanan Shachmurove (Contact Author)

City University of New York, CUNY City College of New York - Department of Economics ( email )

160 Convent Avenue
New York, NY 10031
United States
212-650-6202 (Phone)

The University of Pennsylvania - Department of Economics ( email )

Ronald O. Perelman Center for Political Science
133 South 36th Street
Philadelphia, PA 19104-6297
United States
215-898-1090 (Phone)
215-573-2057 (Fax)

Uriel Spiegel

Bar-Ilan University - Department of Management ( email )

Ramat-Gan, 52900
Israel
011-972-3-5318282 (Phone)
+972.3.535.3329 (Fax)

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