ABSTRACT
Discussion of the impact of microelectronics innovations on the Third World has been confined to the shifting locus of comparative advantage to which these innovations may conceivably give rise. This chapter is concerned with the output and employment effects of microelectronics technologies, and the framework for the analysis of these effects comprises two broad components. The first is what economists refer to as partial equilibrium analysis and the second embraces a variety of so-called general equilibrium or economy-wide modes of analysis. The chapter shows how the conditioning variables bear on the employment impact of microelectronics. In essence, partial equilibrium analysis "focuses on the determination of an equilibrium price and quantity in a given product or input market, where the market is viewed as largely self-contained and independent of other markets. Unlike partial, general equilibrium analysis incorporates the effects of technical change in one sector on output and factor markets in other sectors.
