Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5055962 | Economic Modelling | 2009 | 5 Pages |
Abstract
This paper develops an extension of the endogenous growth model with variety expansion presented in Romer [Romer, P.M., 1990. Endogenous technical change, Journal of Political Economy 98, part 2, S71-S102] by considering public capital accumulation. Characterizing the transitional dynamics, the growth rate of consumption traces (and available number of intermediate goods also might trace) an S-shaped converging path to the equilibrium growth rate, similar to a logistic growth curve, if the intensity of public capital is sufficiently high. We also show that public investment enhances economic growth because it stimulates demand for intermediate goods and raises the market interest rate.
Related Topics
Social Sciences and Humanities
Economics, Econometrics and Finance
Economics and Econometrics
Authors
Toshiki Tamai,