Hicks-neutral technical change
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A Hicks-neutral technical change is a change in the production function of a business or industry which satifies certain economic neutrality conditions. The concept of Hicks neutrality was first put forth in 1932 by John Hicks in his book The Theory of Wages.[1] A change is considered to be Hicks neutral if the change does not affect the balance of labor and capital in the products production function. More formally, given the Solow model production function Y = A * F(K,L), a hicks neutral change is one which only changes A.[2]
[edit] Further reading
- Hicks, John Richard [1932] (1966). The Theory of Wages. St. Martins Press.
- Dupuy, Arnaud (2006). "Hicks Neutral Technical Change Revisited: CES Production Function and Information of General Order". Topics in Macroeconomics 6 (2): 1339.
- Blackorby, Charles; Knox Lovell, C. A.; Thursby, Marie C. (December 1976). "Extended Hicks Neutral Technical Change". The Economic Journal 86 (344): 845–852. doi:.
[edit] References
- ^ (1989) Sir John R. Hicks: Critical Assessments. Routledge, 231. ISBN 0415012724.
- ^ Mike Moffatt. Hicks-Neutral/ Hicksian Neutrality. About, Inc..
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