Is the AK model still alive? The long-run relation between growth and investment re-examined
AbstractTo explore the empirical validity of -type endogenous growth models, the long-run relation between growth and investment is examined. Contrary to Jones's (1995) findings, the broadly measured rate of investment exerts a long-run positive effect on the growth rate. This result is supported by evidence from twenty-four OECD countries, 1950-92, and five major industrialized countries, 1870-1987. The panel-data evidence from OECD countries also supports an extended model based on the Uzawa (1965) / Lucas (1988) two-sector model with transitional dynamics. These findings suggest that the long-run relation between growth and investment is consistent the model.
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Bibliographic InfoArticle provided by Canadian Economics Association in its journal Canadian Journal of Economics.
Volume (Year): 35 (2002)
Issue (Month): 1 (February)
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Postal: Canadian Economics Association Prof. Steven Ambler, Secretary-Treasurer c/o Olivier Lebert, CEA/CJE/CPP Office C.P. 35006, 1221 Fleury Est Montréal, Québec, Canada H2C 3K4
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- O4 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
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