Microeconomics of Technical Change: What's a Better Animal Worth?

Abstract

In their review of research on technical change in agriculture, Peterson and Hayami cite 163 studies. Of the cited studies that present empirical results, virtually all deal with such questions as: (a) What technical changes have occurred? (b) What have been their effects? (c) What forces account for economic growth that has occurred? Also, virtually all of these studies are aggregative. They consider such variables as total expenditures on education, total public expenditures on poultry research, total stock of fixed capital. Study of such retrospective and aggregative questions can help us understand the past and influence the future. But economists can do more to affect future technical changes. In each study cited by Peterson and Hayami, the economist came along after the technical-change-makers had done their work, and the economist made his measurements of past effects of changes that had already been made. Economists could work with technical-changemakers to influence the choice of technical changes that will be made in future.