Glossary of economics research
Results of search for Hicks-neutral technical change follow:
Hicks-neutral technical change:
Given a production function AF(K,L) changes in A are Hicks-neutral, meaning
that they do not affect the optimal choice of K or L. The subject comes up in
practice only for aggregate production functions.
Uzawa, H. "Neutral Inventions and the Stability of Growth Equilibrium,"
The Review of Economic Studies 28:2 (Feb., 1961), 117-124
contains the first known published use of the adjective 'Harrod neutral'
According to it, the criterion of Harrod-neutrality comes from
Harrod, Roy F., "Review of Joan Robinson's Essays in the Theory of
Employment," Economic Journal, vol. 47 (1937), 326-330.
Uzawa also proves that AF(K,L) and F(K,AL) are the right functional forms to
meet Hicks and Harrod-neutrality, and that only the Cobb-Douglas form
accomplishes both.
Contexts: models; macro
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