Production dynamics in case of organizational learning

摘要

Evidences indicate that around 50% of productivity increase originates from organizational learning and learning by doing. The speed of implementing productivity knowledge increase is a key component of competitiveness and for the case when the implementation is instantaneous, an optimal control model is developed. The analysis of this model indicates that, under certain circumstances, the optimal production level does not change over time, and utilizing this property, a closed form solution is provided to determine the optimal production level. When the implementation process happens step by step, a discrete time model is offered, and we found that using the same assumptions, the production dynamics will be decreasing. To determine the optimal production vol-umes, a backward dynamic programming procedure is presented.