Chu, Angus and Kou, Zonglai and Wang, Xilin (2021): Class Struggle in a Schumpeterian Economy. Forthcoming in: China Economic Review
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Abstract
This study explores class struggle between workers and capitalists in a Schumpeterian economy, in which economic growth is driven by innovation in a market economy. We consider the limit on the market power of firms as a policy instrument and derive its optimal levels for workers and capitalists, respectively. Capitalists prefer powerful monopolistic firms, but even workers prefer firms to have some market power because profit provides incentives for innovation. Workers' utility-maximizing degree of monopoly power is decreasing in their discount rate but increasing in innovation productivity and the quality step size. Capitalists' utility-maximizing degree of monopoly power is increasing in the quality step size. We use the difference in these two degrees of monopoly power to measure the severity of their conflict, which becomes less severe when workers' discount rate falls or innovation productivity rises. Finally, at a small (large) quality step size, enlarging it mitigates (worsens) their conflict.
Item Type: | MPRA Paper |
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Original Title: | Class Struggle in a Schumpeterian Economy |
Language: | English |
Keywords: | economic growth; workers; capitalists; class struggle |
Subjects: | E - Macroeconomics and Monetary Economics > E1 - General Aggregative Models > E11 - Marxian ; Sraffian ; Kaleckian O - Economic Development, Innovation, Technological Change, and Growth > O3 - Innovation ; Research and Development ; Technological Change ; Intellectual Property Rights O - Economic Development, Innovation, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity |
Item ID: | 118498 |
Depositing User: | Prof. Angus C. Chu |
Date Deposited: | 08 Sep 2023 00:31 |
Last Modified: | 08 Sep 2023 00:31 |
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URI: | https://mpra.ub.uni-muenchen.de/id/eprint/118498 |
Available Versions of this Item
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Class Struggle in a Schumpeterian Economy. (deposited 03 Nov 2021 03:46)
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Class Struggle in a Schumpeterian Economy. (deposited 11 Jun 2022 14:13)
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Class Struggle in a Schumpeterian Economy. (deposited 11 Aug 2022 07:34)
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Class Struggle in a Schumpeterian Economy. (deposited 09 Oct 2022 07:00)
- Class Struggle in a Schumpeterian Economy. (deposited 08 Sep 2023 00:31) [Currently Displayed]
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Class Struggle in a Schumpeterian Economy. (deposited 09 Oct 2022 07:00)
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Class Struggle in a Schumpeterian Economy. (deposited 11 Aug 2022 07:34)
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Class Struggle in a Schumpeterian Economy. (deposited 11 Jun 2022 14:13)