Journal of Political Economy Vol. 79 No. 5 1971
Technological Externalities and Resource Allocation
Abstract
This paper is an examination of the effects on resource allocation of technological externalities within a given industry. A competitive equilibrium in the presence of technological externalities in production is compared with a Pareto optimum in terms of input use and final outputs of the economy. Resource allocation with technological externalities and imperfect competition is also compared with the competitive and Pareto-optimal solutions. It is shown that standard theory's approach for comparing resource use requires extremely restrictive assumptions and, in general, can lead to significant errors.
- DOI
- 10.1086/259810
- Volume
- 79
- Issue
- 5
- Pages
- 983-1001
- Language
- en
- Sources
- openalex crossref