References of "Irmen, Andreas 50002026"
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See detailCapital- and Labor-Saving Technical Change in an Aging Economy
Irmen, Andreas UL

Scientific Conference (2014, April)

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See detailCapital- and Labor-Saving Technical Change in an Aging Economy
Irmen, Andreas UL

Presentation (2014, March)

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See detailPopulation, Pensions, and Endogenous Economic Growth
Irmen, Andreas UL; Heer, Burkhard

in Journal of Economic Dynamics & Control (2014), 46

We study the effect of a declining labor force on the incentives to engage in labor-saving technical change and ask how this effect is influenced by institutional characteristics of the pension scheme ... [more ▼]

We study the effect of a declining labor force on the incentives to engage in labor-saving technical change and ask how this effect is influenced by institutional characteristics of the pension scheme. When labor is scarcer it becomes more expensive and innovation investments that increase labor productivity are more profitable. We incorporate this channel in a new dynamic general equilibrium model with endogenous economic growth and heterogeneous overlapping generations. We calibrate the model for the US economy and obtain the following results. First, the effect of a decline in population growth on labor productivity growth is positive and quantitatively significant. In our benchmark, it is predicted to increase from an average annual growth rate of 1.74% over 1990–2000 to 2.41% in 2100. Second, institutional characteristics of the pension system matter both for the growth performance and for individual welfare. Third, the assessment of pension reform proposals may depend on whether economic growth is endogenous or exogenous. [less ▲]

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See detailProperty Rights, Public Enforcement, and Growth
Irmen, Andreas UL; Kuehnel, Johanna

in Scandinavian Journal of Economics (2014), 116

We study the link between public enforcement of property rights, innovation investments, and economic growth in an endogenous growth framework with an expanding set of product varieties. We find that a ... [more ▼]

We study the link between public enforcement of property rights, innovation investments, and economic growth in an endogenous growth framework with an expanding set of product varieties. We find that a government may assure positive equilibrium growth through public employment in the enforcement of property rights, if the economic environment is sufficiently favorable to growth and/or public enforcement is sufficiently effective. However, in terms of welfare an equilibrium path without property rights protection and growth might be preferable. In this case the enforcement of property rights involves too much reallocation of labor from production and research towards the public sector. [less ▲]

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See detailReal Factor Prices and Factor-Augmenting Technical Change
Irmen, Andreas UL

in The B.E. Journal of Macroeconomics (2014), 14(1)

How does technical change affect real factor prices? This paper gives a comprehensive answer for the most important benchmark used in the modern debate: technical change is factor-augmenting and ... [more ▼]

How does technical change affect real factor prices? This paper gives a comprehensive answer for the most important benchmark used in the modern debate: technical change is factor-augmenting and materializes in a neoclassical economy with competitive firms equipped with a constant elasticity of substitution (CES) production function. I establish that the effect of labor-augmenting technical change crucially hinges on whether the economy’s capital endowment exceeds or falls short of its amount of efficient labor. This distinction determines the sign of the effect for sufficiently small values of the elasticity of substitution. In the former case, labor-augmenting technical progress must increase the equilibrium wage. In the latter case the equilibrium wage is reduced. In both cases, technical progress increases the price of capital. Overall, the analysis stresses that not only the elasticity of substitution but also the degree of diminishing returns, the distribution parameters of the CES, and the level of the efficient capital intensity matter for the effect of labor-augmenting technical change on real factor prices. Mutatis mutandis, these considerations carry over to the case of capital-augmenting technical change. [less ▲]

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See detailAdjustment costs in a variant of Uzawa's steady-state growth theorem
Irmen, Andreas UL

in Economics Bulletin (2013)

Uzawa's theorem (Uzawa (1961)) is extended to allow for adjustment costs in the process of capital accumulation. A new steady-state growth theorem with adjustment costs establishes that capital-augmenting ... [more ▼]

Uzawa's theorem (Uzawa (1961)) is extended to allow for adjustment costs in the process of capital accumulation. A new steady-state growth theorem with adjustment costs establishes that capital-augmenting technical change may arise in steady state. This is in sharp contrast to Uzawa's original finding. In a growing economy this possibility arises since diminishing returns in the production of capital cause a gap between the growth of gross capital investments and the growth of capital. In steady state, capital-augmenting technical change has the role to fill this gap. The discussion of the new theorem characterizes the conditions under which a steady-state path with capital-augmenting technical change exists. [less ▲]

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See detailCapital- and Labor-Saving Technical Change in an Aging Economy
Irmen, Andreas UL

E-print/Working paper (2013)

Does population aging and the associated increase in the old-age dependency ratio affect economic growth ? The answer is given in a novel analytical framework that allows for population aging to affect ... [more ▼]

Does population aging and the associated increase in the old-age dependency ratio affect economic growth ? The answer is given in a novel analytical framework that allows for population aging to affect endogenous capital- and labor-saving technical change. The short-run analysis reveals that population aging induces more labor- and less capital-saving technical change as it increases the relative scarcity of labor with respect to capital. Due to external contemporaneous knowledge spill-overs across innovating firms induced technical change has a first-order effect on current aggregate income. In the long-run capitalsaving technical progress vanishes, and the economy’s growth rate reflects only labor-saving technical change. However, the mere possibility of capital-saving technical change is shown to imply that the economy’s steady-state growth rate becomes independent of its age structure: neither a higher life-expectancy nor a decline in fertility affects economic growth in the long run. [less ▲]

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See detailA Generalized Steady-State Growth Theorem
Irmen, Andreas UL

E-print/Working paper (2013)

Uzawa’s steady-state growth theorem (Uzawa (1961)) is generalized to a neoclassical economy that uses current output, e. g., to create technical progress or to manufacture intermediates. The difference ... [more ▼]

Uzawa’s steady-state growth theorem (Uzawa (1961)) is generalized to a neoclassical economy that uses current output, e. g., to create technical progress or to manufacture intermediates. The difference between aggregate final-good production and these resources is referred to as net output. The new generalized steady-state growth theorem holds since net output exhibits constant returns to scale in capital and labor. This insight provides an understanding for why technical change is labor-augmenting in steady state even if capital-augmenting technical change is feasible. By example, this point is made for three recent growth models that allow for endogenous capital- and labor-augmenting technical change, namely, Irmen (2013), Acemoglu (2003), and Acemoglu (2009), Chapter 15. The reduced form of these models is shown to be consistent with the generalized steady-state growth theorem. [less ▲]

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See detailPopulation, Pensions, and Endogenous Economic Growth
Heer, Burkhard; Irmen, Andreas UL

E-print/Working paper (2013)

We study the effect of a declining labor force on the incentives to engage in labor-saving technical change and ask how this effect is influenced by institutional characteristics of the pension scheme ... [more ▼]

We study the effect of a declining labor force on the incentives to engage in labor-saving technical change and ask how this effect is influenced by institutional characteristics of the pension scheme. When labor is scarcer it becomes more expensive and innovation investments that increase labor productivity are more profitable. We incorporate this channel in a new dynamic general equilibrium model with endogenous economic growth and heterogeneous overlapping generations. We calibrate the model for the US economy and obtain the following results. First, the effect of a decline in population growth on labor productivity growth is positive and quantitatively significant. In our benchmark, it is predicted to increase from an average annual growth rate of 1.74% over 1990-2000 to 2.41% in 2100. Second, institutional characteristics of the pension system matter both for the growth performance and for individual welfare. Third, the assessment of pension reform proposals may depend on whether economic growth is endogenous or exogenous. [less ▲]

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See detailWie Glücklich ist das Land? Zum Zusammenhang von Geld und Glück
Irmen, Andreas UL; Tabakovic, Amer

Article for general public (2012)

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See detailBeschäftigungswirkungen verringerter Sozialleistungen auf dem Arbeitsmarkt'
Irmen, Andreas UL; Lipponer, Christoph

in Wirtschaftswissenschaftliches Studium (2011), 40

Von dem vierten Gesetz für moderne Dienstleistungen am Arbeitsmarkt (Hartz IV), das mit dem 1. Januar 2005 in Kraft trat, erhoffte sich der Gesetzgeber eine Stärkung der Anreize, Arbeit anzubieten. Dieser ... [more ▼]

Von dem vierten Gesetz für moderne Dienstleistungen am Arbeitsmarkt (Hartz IV), das mit dem 1. Januar 2005 in Kraft trat, erhoffte sich der Gesetzgeber eine Stärkung der Anreize, Arbeit anzubieten. Dieser Aufsatz analysiert die Beschäftigungswirkungen einer Senkung staatlicher Unterstützungsleistungen für arbeitslos Gemeldete in einem einfachen Arbeitsmarktmodell mit einem vom Lohnabstand abhängigen Arbeitsangebot. In diesem Modell erhöht eine solche Senkung das Arbeitsangebot. Ist der Arbeitsmarkt vollkommenen, so führt dies zu einer Senkung des gleichgewichtigen Reallohns und damit zu mehr Beschäftigung. In einem unvollkommenen Arbeitsmarkt mit einem bindenden Mindestlohn kann diese Wirkung ebenfalls erzielt werden, wenn der Anstieg der unfreiwillig Arbeitslosen z.B. die Verhandlungsmacht der Gewerkschaften reduziert und über diesen Umweg zu einem niedrigeren Reallohn führt. Positive Beschäftigungswirkungen sind deshalb aber erst zeitverzögert zu erwarten. [less ▲]

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See detailProperty Rights, Optimal Public Enforcement, and Growth
Irmen, Andreas UL; Kuehnel, Johanna

Report (2011)

We study the link between public enforcement of property rights, innovation investments, and economic growth in an endogenous growth framework with an expanding set of product varieties. We find that a ... [more ▼]

We study the link between public enforcement of property rights, innovation investments, and economic growth in an endogenous growth framework with an expanding set of product varieties. We find that a government may assure positive equilibrium growth through public employment in the enforcement of property rights, if the economic environment is sufficiently favorable to growth and/or public enforcement is sufficiently effective. However, in terms of welfare an equilibrium path without property rights protection and growth might be preferable. In this case the enforcement of property rights involves too much reallocation of labor from production and research towards the public sector. [less ▲]

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See detailIst Wirtschaftswachstum systemimmanent?
Irmen, Andreas UL

Report (2011)

No abstract is available for this item.

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See detailSteady-State Growth and the Elasticity of Substitution
Irmen, Andreas UL

in Journal of Economic Dynamics & Control (2011), 35

In a neoclassical economy with endogenous capital- and labor-augmenting technical change the steady-state growth rate of output per worker is shown to increase in the elasticity of substitution between ... [more ▼]

In a neoclassical economy with endogenous capital- and labor-augmenting technical change the steady-state growth rate of output per worker is shown to increase in the elasticity of substitution between capital and labor. This confirms the assessment of Klump and de La Grandville (2000) that a greater elasticity of substitution allows for faster of economic growth. However, unlike their findings my result applies to the steady-state growth rate. Moreover, it does not hinge on particular assumptions on how aggregate savings come about. It holds for any household sector allowing savings to grow at the same rate as aggregate output. Download Info [less ▲]

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See detailIst Wirtschaftswachstum systemimmanent?
Irmen, Andreas UL

Report (2011)

No abstract is available for this item.

Detailed reference viewed: 55 (2 UL)
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See detailSteady-State Growth and the Elasticity of Substitution
Irmen, Andreas UL

Report (2010)

In a neoclassical economy with endogenous capital- and labor-augmenting technical change the steady-state growth rate of output per worker is shown to increase in the elasticity of substitution between ... [more ▼]

In a neoclassical economy with endogenous capital- and labor-augmenting technical change the steady-state growth rate of output per worker is shown to increase in the elasticity of substitution between capital and labor. This confirms the assessment of Klump and de La Grandville (2000) that the elasticity of substitution is a powerful engine of economic growth. However, unlike their findings my result applies to the steady-state growth rate. Moreover, it does not hinge on particular assumptions on how aggregate savings come about. It holds for any household sector allowing savings to grow at the same rate as aggregate output. [less ▲]

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See detailFactor Substitution, Income Distribution and Growth in a Generalized Neoclassical Model
Irmen, Andreas UL; Klump, Rainer UL

in GERMAN ECONOMIC REVIEW (2009), 10(4), 464-479

We analyze a generalized neoclassical growth model that combines a normalized CES production function and possible asymmetries of savings out of factor incomes. This generalized model helps to shed new ... [more ▼]

We analyze a generalized neoclassical growth model that combines a normalized CES production function and possible asymmetries of savings out of factor incomes. This generalized model helps to shed new light on a recent debate concerning the impact of factor substitution and income distribution on economic growth. We show that this impact relies on both an efficiency and a distribution effect, where the latter is caused by the distributional consequences of an increase in the elasticity of substitution. While the efficiency effect is always positive, the sign of the distribution effect depends on the particular savings hypothesis. If the savings rate out of capital income is substantial so that a certain threshold value is surpassed, the efficiency effect dominates and higher factor substitution accelerates the accumulation of capital and works as a major engine of growth. [less ▲]

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See detailFrictional unemployment, labor market institutions, and endogenous economic growth
Irmen, Andreas UL

in Economics Bulletin (2009), 29(2), 1127-1138

For a given set of labor market institutions, the rate of frictional unemployment depends on the evolution of the pool of job-seekers. Unemployment rises with the growth rate of labor supply that is ... [more ▼]

For a given set of labor market institutions, the rate of frictional unemployment depends on the evolution of the pool of job-seekers. Unemployment rises with the growth rate of labor supply that is proportionate to the rate of population growth. If economic growth is semi-endogenous, the steady-state growth rate depends positively on the rate of population growth. This suggests a trade-off between growth and unemployment: a faster growing economy has a higher unemployment rate. As a consequence, faster growth may not be desirable from a welfare point of view. We make this point in a parsimonious setting where semi-endogenous growth derives from the division of labor and the associated gains from specialization. [less ▲]

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See detailFactor Substitution, Income Distribution and Growth in a Generalized Neoclassical Model
Irmen, Andreas UL; Klump, Rainer

in German Economic Review (2009), 10

We analyze a generalized neoclassical growth model that combines a normalized CES production function and possible asymmetries of savings out of factor incomes. This generalized model helps to shed new ... [more ▼]

We analyze a generalized neoclassical growth model that combines a normalized CES production function and possible asymmetries of savings out of factor incomes. This generalized model helps to shed new light on a recent debate concerning the impact of factor substitution and income distribution on economic growth. We show that this impact relies on both an efficiency and a distribution effect, where the latter is caused by the distributional consequences of an increase in the elasticity of substitution. While the efficiency effect is always positive, the sign of the distribution effect depends on the particular savings hypothesis. If the savings rate out of capital income is substantial so that a certain threshold value is surpassed, the efficiency effect dominates and higher factor substitution accelerates the accumulation of capital and works as a major engine of growth. Copyright 2009 The Authors. Journal Compilation Verein für Socialpolitik and Blackwell Publishing Ltd. [less ▲]

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See detailProductive Government Expenditure And Economic Growth
Irmen, Andreas UL; Kuehnel, Johanna

in Journal of Economic Surveys (2009), 23(4), 692-733

We provide a comprehensive survey of the recent literature on the link between productive government expenditure and economic growth. We show that an understanding of the core results and the ensuing ... [more ▼]

We provide a comprehensive survey of the recent literature on the link between productive government expenditure and economic growth. We show that an understanding of the core results and the ensuing contributions can be gained from the study of their respective Euler equations. We argue that the existing literature incorporates many relevant aspects; however, policy recommendations tend to hinge on several knife-edge assumptions. Therefore, future research ought to focus more on idea-based endogenous growth models to check the robustness of policy recommendations. Moreover, the inclusion of hitherto unexplored types of government expenditure, e.g. on the 'rule of law', would be desirable. Copyright � 2009 Blackwell Publishing Ltd. [less ▲]

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