Figure 1: Variation of Switch Points with the Markup in the Steel Industry1.0 Introduction
I want to continue to analyze
This example does not do everything I would like with a three-commodity example. Specifically,
I do not have a case of triple-switching in the parameter space I explore in this post.
That space of relative markups, in a model with n industries, has (n – 1) dimensions.
And it is partitioned by (n – 2)-dimensional manifolds, where each manifold corresponds to
a fluke switch point. Whether or not reswitching, capital-reversing, or the recurrence of techniques exist
depends on relative markups. This post illustrates in an example with three produced commodities.
This economy produces a single consumption good, called corn. Corn is also aRead More »