Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/94810
Authors: 
Pelikan, Pavel
Year of Publication: 
1997
Series/Report no.: 
IUI Working Paper 480
Abstract: 
Attention is called to a little explored scarce resource, termed 'economic competence', which combines features of human capital and bounded rationality, and causes a singularity in resource-allocation in society. The performance of each economy is shown to strongly depend on how this resource is allocated, which in turn strongly depends upon the economy's institutions ('rules of the game'). Two stylized institutional variants of market selection and one of government selection are compared for their short-term and long-term effects upon the output and growth of a perfect team economy. The results are exemplified by throwing new light on the social value of financial markets and the limitations of industrial policies.
Subjects: 
Economic competence
Human capital
Bounded rationality
Institutions
Entrepreneurs
Investors
Government
Market selection
Financial Markets
Industrial policies
JEL: 
D20
D92
H10
L52
O40
P51
Document Type: 
Working Paper

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