1,721,273 research outputs found
Returns to specialization, competition, population and growth
No full textUsing an expanding-variety endogenous growth model with purposive human capital accumulation, this paper provides an alternative explanation of why we may observe an ambiguous correlation between product market competition (PMC) and economic growth, and between population and economic growth rates. Our explanation is based on the notion of ‘returns to specialization’. Under the model's assumptions, PMC and economic growth are ambiguously correlated when returns to specialization are decreasing, whereas population growth and productivity growth are ambiguously correlated when returns to specialization are increasing. From a theoretical point of view, these results are explained by the presence or absence of an ‘increasing production-complexity’ effect associated to the use of a larger number of intermediate-input varieties in the same production proces
Potere di Mercato e Crescita Economica Aggregata nei Modelli con Innovazione Tecnologica Endogena
No full textThis paper overviews the main interactions between product market competition and long-run growth. We start with the first generation of R&D-based growth models and keep distinct the vertical from the horizontal differentiation approaches. Our main objective here is to study why these two branches of the same literature give different predictions as for the long-run relationship between competition and growth. Next, we introduce the second generation of R&D-based growth models and analyse the way they reconcile the Schumpeterian paradigm with the Darwinian view. Finally, we review the literature that endogenises the markups and the one that eliminates the scale-effects prediction
Competition and R&D investment in Human capital-driven growth
No full textUsing a model of purposive R&D activity and human capital accumulation, this paper studies the impact of product market competition on research effort and economic growth. Innovation is postulated to take place by combining with constant returns to scale human capital and the existing stock of disembodied knowledge. In the long-run, competition always affects R&D investment while its impact on growth (driven by skill acquisition) depends on the way product market rivalry is parameterized. These results are discussed in the light of recent macroeconomic evidence and interpreted in terms of the interplay between the allocative-efficiency and the dynamic-efficiency effect
Product proliferation, population, and economic growth
No full textThis paper reassesses the long-run relationship between population growth and economic growth in two different frameworks. In the first one, aggregate human capital evolves exogenously over time, while in the second, individuals choose endogenously their investment in education. When endogenous human capital investment takes place, the potential tension between the productivity gains due to specialization and the productivity losses due to more production complexity arising from an expansion in the number of intermediate-input varieties employed in the production of final goods is crucial in determining the sign of the correlation between population growth and per capita income growth
Horizontal Innovation, Market Power and Growth
No full textI build a generalised model of horizontal product innovation and economic growth taking explicitly into account the most relevant insights stemming from the recent literature on this topic. What results from the analysis is that, when innovation is both deterministic and horizontal, the relationship between market power and aggregate growth is not robust at all. It is also found that not only technology, but also the inter-sectoral competition for the same resource affects growth. This is particularly relevant in terms of public policies aimed at the strategic allocation of skilled workers to the different sectors of the economy
Public capital, private capital and economic growth
No full textAn endogenous growth model is presented in which productive government expenditure takes the form of a stock. Private and public capital interact with each other in two different ways. The first takes place in the final output sector and depends on the specification of the aggregate production function (Cobb-Douglas vs. CES). The second has to do with the rates of investment in the two types of capital and arises from the law of motion of public capital. The share of public capital devoted to output production can be exogenous or endogenous. Our results suggest that when this share is exogenous along the balanced growth path the optimal growth rate of the economy depends positively on the degree of complementarity between the investments in the two kinds of capital, irrespective of the form of the aggregate production function. This is also true when the share of public capital devoted to output production is endogenous, as long as the inverse of the intertemporal elasticity of substitution in consumption is sufficiently large. When the technology for final output production is CES and the social planner can choose the fraction of public capital to be devoted to goods-production, optimal growth crucially depends on the elasticity of substitution between the two forms of capital in the production of goods. We analyze the conditions for an increase in this elasticity to yield either a positive, or a negative, or else an ambiguous effect on the economy’s optimal growth rate. Unlike Barro (1990), the relationship between optimal growth and the share of productive government expenditure in GDP is nonlinear and characterized by threshold-effects
Population in factor accumulation-based growth
Full text linkThis paper analyzes the conditions under which, within a two-sector endogenous growth model with human and physical capital accumulation but without R&D-driven disembodied technological progress, it is possible to observe an ambiguous effect of population growth on economic growth, as empirical evidence suggests. We present three models. In each of them the engine of long-run growth is human capital accumulation. Population growth exerts ambiguous effects on economic growth only when human and physical capital are complementary for each other in the production of new human capital. This result is explained in terms of the interplay between the “dilution” and “accumulation” effects. In accordance with the growth literature exhibiting endogenous human capital accumulation and R&D activity, we also find that income growth can be positive even with stable population, that both the growth rate and the level of per-capita income are independent of population size, and finally that the level of per-capita income is proportional to per-capita human capital. We conclude that it is possible to reach the same results even without explicitly assuming endogenous and purposeful investment in research by firm
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