A FLEXIBLE MODEL OF FACTOR BIASED TECHNOLOGICAL-CHANGE - AN APPLICATION TO JAPANESE AGRICULTURE

Results indicate that when restrictive assumptions on production structure and parameter constancy are avoided and quality adjusted flow variables employed, an explanation of factor-biased technological change emerges that is consistent with observed patterns of factor use. While substitution possibilities during this period were limited, biol nearly as strong a substitute for labor as for land. Technological change was found to be significantly labor-saving and using in biological inputs and machinery and only weakly land-saving. Descriptions of pre-World War II technology as primarily land-saving miss the significant contribution of labor-saving technology in agricultural transformation and ignore the dynamics of inter-sectoral factor demand. © 1991.