The Division of Labor and Roundabout Production: Allyn Young Revisited

23 Pages Posted: 24 Jan 2003

See all articles by Guang-Zhen Sun

Guang-Zhen Sun

Monash University - Department of Economics; Max Planck Institute for Research Into Economic Systems

Monchi Lio

National Sun Yat-sen University - Political Economics

Multiple version iconThere are 2 versions of this paper

Date Written: February 2002

Abstract

This paper investigates Allyn Young's two important doctrines concerning the division of labor and roundabout production: Apart from advancement in the state of knowledge, the progressive division of labor, which can take place within a given population, brings about the adoption of more specialized, differentiated intermediate goods in the production process; the level of division of labor and the extent of the market depend on each other. Using a general equilibrium model with increasing returns to specialization, economies of complementarity between intermediate goods, and transaction costs, we demonstrate that the level of division of labor and the number of intermediate goods increase concurrently as transaction conditions are improved.

Keywords: Allyn Young, Choice of Technology, Division of Labor, Increasing Returns, Roundabout Production, Transaction Costs

JEL Classification: L11, O12, O14

Suggested Citation

Sun, Guang-Zhen and Lio, Monchi, The Division of Labor and Roundabout Production: Allyn Young Revisited (February 2002). Available at SSRN: https://ssrn.com/abstract=366540 or http://dx.doi.org/10.2139/ssrn.366540

Guang-Zhen Sun (Contact Author)

Monash University - Department of Economics ( email )

Wellington Road
Clayton, Victoria 3
Australia
61-3-99052409 (Phone)
61-3-99055476 (Fax)

Max Planck Institute for Research Into Economic Systems

Kahlaische Strasse 10
D-07745 Jena, 07745
Germany

Monchi Lio

National Sun Yat-sen University - Political Economics ( email )

70 Lien-hai Rd.
Kaohsiung 80424, 80743
Taiwan

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
165
Abstract Views
1,632
rank
215,358
PlumX Metrics