what do we mean by technological change?
- invention + innovation leads to new products and new ways of doing things usually stimulated by R&D expenditure
- quality and quantity of capital influencing productive capacity
- new opportunities in product markets or dismantling of barriers to entry
two areas of discussion
- affect on costs
- affect on methods of production
costs
- definition: payments made to factors employed
- technology reduces costs?
- perhaps technology raises productivity of labour (output per worker reducing variable cost or raises value of output per worker)
- could lower productivity? facebook at work (bbc)
- illustrate lower cost
- may raise fixed costs due to investment costs
methods of production
- technology encorporated into capital
- capital intensive v labour intensive
- knowledge intensive labour (highly skilled and high training requirements) or
- deskilling?
- possibility of scale and scope economies
- 24 hour production 365 days a year
- weakening unions
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