Abstract: In many endogenous economic growth models, the possibility of an economy to grow is often discussed whether the growth rate g on the balanced growth path expressed in terms of the parameters in the model is larger than one. It is known that, if in a model, the technologies in consumption goods production sector and capital goods production sector combined together exhibit increasing returns to scale, then the model can generate an unbounded growth.1' For exemple, in Romer (1986), Lucas (the second model, 1988) and Yuen (1992), a consumption goods production technology, which exhibits increasing returns to scale because of the Marshallian externality, combined with a linear capital accumulation technology generates an unbounded economic growth. In Tamura (1991) and Glomm and Ravikumar (1992), a capital accumulation technology, which exhibits increasing returns to scale, combined with a linear consumption goods production technology generates an unbounded economic growth. Consider an endogenous economic growth model in which the decision about improving the quality of existing capital (R & D activities) is the engine of growth. The question I would like to address in this
Publication Year: 1996
Publication Date: 1996-03-25
Language: en
Type: article
Access and Citation
AI Researcher Chatbot
Get quick answers to your questions about the article from our AI researcher chatbot