The main feature of this monograph is that it is suited well for undergraduate economics classes which include an exam of the micro-prices economics of technological change. Among the topics given are those dealing with the impact of technology on macroeconomics. Such topics include the pricing of capital, demand, pricing of labor, economic growth, technological change and productivity. The paper looks into the role of technology in the macroeconomy and the implications of that impact on decision-making in the economy. The paper also looks into how firms use technology to compete with other firms.
Two major themes dominate this book. The first theme explored is the impact of new technologies on the macro-economy. The second major theme explored is that of market design economics of technology firms. The two topics together form the main topic of the book.
The main paper deals with the pricing of capital and suggests that the adoption of IT technology by large firms may affect the pricing of capital across firms. The research then goes on to show that the adoption of IT-based accounting techniques by large firms could result in a reduction in the profitability and the size of firms in the short and medium terms. The analysis then goes on to suggest that there is a disconnect between the supply of labor and the demand for it. The supply of labor is increasing but the demand for it is decreasing. This disconnect results in a situation where there is excess capacity in relation to the demand.
As capital prices come down the efficiency of firms increases and capital costs come down. This results in increased productivity and hence an increase in gross domestic product (GDP). Further analysis shows that such an economy could be driven by two factors, technology and demand. An increase in technology in a particular economic field drives up the efficiency of that field and hence drives up its demand, which causes a rise in its price as demand for the service increases.
It follows that the adoption of IT-based accounting practices by large firms could result in a decline in the profitability and size of firms in the short and medium terms. If correct economic policies are adopted then an economy could be driven by technology growth. An example of this policy is provided in which spending on information technology exceeds direct spend on fixed capital and therefore drives up the technology output. Economic policies that allow for an increase in technology spending economics are discussed and suggested.
This book is an important text for all students of economics. It covers all important economic research topics including macro economics, microeconomics and the micro-economic microuiabilities. The research is clear and concise and the author’s clear writing style makes the book easy to read and understand. This is an excellent resource for all economics students studying macro economics.