IMPLICATIONS OF REGULATION FOR INDUCED TECHNICAL CHANGE.

V. Kerry Smith

Research output: Chapter in Book/Report/Conference proceedingChapter

13 Citations (Scopus)

Abstract

The purpose of this paper is to extend the Averch-Johnson model of the regulated firm so as to allow for the endogenous selection of factor augmenting technical change. A simple model is developed which avoids the questions of timing, capitalization, and internalization of innovations and focuses on the incentives to a firm for innovational choice under cost minimizing conditions versus several formulations of the regulated setting. The results suggest that regulation can distort the innovational selections. Moreover, in the case of the profit maximizing firm subject to ″fair″ return on investment regulation, the innovational choices will reinforce the static overcapitalization tendencies.

Original languageEnglish (US)
Title of host publicationBell J Econ Manage Sci
Pages623-632
Number of pages10
Volume5
Edition2
StatePublished - Sep 1974
Externally publishedYes

Fingerprint

Profitability
Innovation
Costs

ASJC Scopus subject areas

  • Engineering(all)

Cite this

Smith, V. K. (1974). IMPLICATIONS OF REGULATION FOR INDUCED TECHNICAL CHANGE. In Bell J Econ Manage Sci (2 ed., Vol. 5, pp. 623-632)

IMPLICATIONS OF REGULATION FOR INDUCED TECHNICAL CHANGE. / Smith, V. Kerry.

Bell J Econ Manage Sci. Vol. 5 2. ed. 1974. p. 623-632.

Research output: Chapter in Book/Report/Conference proceedingChapter

Smith, VK 1974, IMPLICATIONS OF REGULATION FOR INDUCED TECHNICAL CHANGE. in Bell J Econ Manage Sci. 2 edn, vol. 5, pp. 623-632.
Smith VK. IMPLICATIONS OF REGULATION FOR INDUCED TECHNICAL CHANGE. In Bell J Econ Manage Sci. 2 ed. Vol. 5. 1974. p. 623-632
Smith, V. Kerry. / IMPLICATIONS OF REGULATION FOR INDUCED TECHNICAL CHANGE. Bell J Econ Manage Sci. Vol. 5 2. ed. 1974. pp. 623-632
@inbook{d831d21564574aeaa03ec3d51c49b894,
title = "IMPLICATIONS OF REGULATION FOR INDUCED TECHNICAL CHANGE.",
abstract = "The purpose of this paper is to extend the Averch-Johnson model of the regulated firm so as to allow for the endogenous selection of factor augmenting technical change. A simple model is developed which avoids the questions of timing, capitalization, and internalization of innovations and focuses on the incentives to a firm for innovational choice under cost minimizing conditions versus several formulations of the regulated setting. The results suggest that regulation can distort the innovational selections. Moreover, in the case of the profit maximizing firm subject to ″fair″ return on investment regulation, the innovational choices will reinforce the static overcapitalization tendencies.",
author = "Smith, {V. Kerry}",
year = "1974",
month = "9",
language = "English (US)",
volume = "5",
pages = "623--632",
booktitle = "Bell J Econ Manage Sci",
edition = "2",

}

TY - CHAP

T1 - IMPLICATIONS OF REGULATION FOR INDUCED TECHNICAL CHANGE.

AU - Smith, V. Kerry

PY - 1974/9

Y1 - 1974/9

N2 - The purpose of this paper is to extend the Averch-Johnson model of the regulated firm so as to allow for the endogenous selection of factor augmenting technical change. A simple model is developed which avoids the questions of timing, capitalization, and internalization of innovations and focuses on the incentives to a firm for innovational choice under cost minimizing conditions versus several formulations of the regulated setting. The results suggest that regulation can distort the innovational selections. Moreover, in the case of the profit maximizing firm subject to ″fair″ return on investment regulation, the innovational choices will reinforce the static overcapitalization tendencies.

AB - The purpose of this paper is to extend the Averch-Johnson model of the regulated firm so as to allow for the endogenous selection of factor augmenting technical change. A simple model is developed which avoids the questions of timing, capitalization, and internalization of innovations and focuses on the incentives to a firm for innovational choice under cost minimizing conditions versus several formulations of the regulated setting. The results suggest that regulation can distort the innovational selections. Moreover, in the case of the profit maximizing firm subject to ″fair″ return on investment regulation, the innovational choices will reinforce the static overcapitalization tendencies.

UR - http://www.scopus.com/inward/record.url?scp=0016103341&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=0016103341&partnerID=8YFLogxK

M3 - Chapter

VL - 5

SP - 623

EP - 632

BT - Bell J Econ Manage Sci

ER -