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| Author: | Sato, R. Ramachandran, R. |
| Title: | Optimal growth with endogenous technical progress: Hicksian Bias in a macro model |
| Journal: | Japanese Economic Review
2000 : JUN, VOL. 51:2, p. 193-206 |
| Index terms: | Growth Optimization Technological change Models |
| Language: | eng |
| Abstract: | If productivity growth is endogenous, the question of whether to allocate some resources to increase the efficiency of capital needs to be examined despite the conventional wisdom that only Harrod-neutral technical progress is compatible with the steady state. This paper describes the crucial role that the production technology and research sectors play in determining the allocation of resources for accumulating physical capital and enhancing the productivity of inputs. There is developed a model of biased growth, where, even in the steady state, the efficiency of capital and labour are increasing due to the allocation of resources to the research sector. |
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