Full text: Brief von Tibor Scitovsky an Josef Steindl

P.S. In an earlier paper of yours, on "Technical Progress and Evolution", 
which I found most interesting, I got confused right at the beginning and 
would be very grateful if you would straighten me out. 
You define N as cumulative output, c M as the Kca»Hisfei*B direct labor 
r N cost 
cost of the Nth unit, and as the cumulated direct labor A of N units. 
Accordidngly, eguation (6.2) is the integral of equation (6.1). So far so 
good. But on the next page you call N/C^ productivity, by which you 
presumably mean output per unit of labor. But isn't your definition of 
productivity a rather special one, very different from the usual definition, 
in that it is the average productivity averaged over the entire life-time 
irs 
of the plant or equipment. Is not the usual definition of productivity the 
differential of yours with respect to time?I get confused, because from your 
argument one gets the impression that those two productivities are one and 
the same thing. 
Is the answer to my puzzle that since you assume output to grow 
exponentially, those two very different productivity concepts grow at the 
same rate? 
Oti 
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