TY  - JOUR
AU  - Bernstein,Jeffrey I.
AU  - Nadiri,M. Ishaq
TI  - Research and Development, Utilization and Labor Requirements: A Dynamic Analysis
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 1016
PY  - 1982
Y2  - November 1982
UR  - http://www.nber.org/papers/w1016
L1  - http://www.nber.org/papers/w1016.pdf
N1  - Author contact info:
Jeffrey I. Bernstein
Department of Economics
University Park Campus
Florida International University
11200 S.W. 8th Street
Miami, FL 33199
Tel: 305/348-2592
E-Mail: jeffrey.bernstein@fiu.edu

M. Ishaq Nadiri
Department of Economics
New York University
19 W. 4th Street, 6th Floor
New York, NY  10012
Tel: 212/998-8968
Fax: 212/995-4013
E-Mail: min1@nyu.edu
AB  - In this study we have developed a dynamic analysis of a firm under taking plant and equipment and research and development investment,along with labor requirement and P&E utilization decisions. It is shown that in the short run increases in R&D cause the utilization rate of plant and equipment to rise and to decrease demand for labor per unit of R&D. We distinguish between the effects of the stock of R&D and the investment flow. The short run effect of changes in the stock of R&Don labor demand are quite distinct from the behavior observed along the intertemporal path. Along the path increases in the R&D investment rate must be accompanied by an increase in the labor requirement per unitof R&D. Contrary to a view point held by many, the R&D investment flow does not displace labor. Finally, our model provides a framework to justify the empirically observed positive relationship between the utilization and the P&E investment rates.
ER  -