Without Government the Market Fails and Fails Badly
What the Simon-Ehrlich Debate Reveals About Technological Change
In a previous post, we discussed some of the evidence suggesting that technology is indeed endogenous and does respond to scarcities and prices.
Many economists have worked on modeling this type of endogeneity of technology and how it responds to prices. Remember the great economist John Hicks’s assertion, which we quoted in our previous post, about how higher price of a factor will tend to induce technological changes directed at economizing on that factor.