More on the dynamics in the endogenous growth model with human capital
AbstractThis paper shows that multiple and globally indeterminate long-run growth rates can easily arise in the two-sector growth model introduced by Lucas (1988). This result is generated by the existence of diminishing returns to time at the private level in human capital accumulation and the existence of external effects from human capital stock in production. The paper asserts that two interior balanced growth paths arise under a sufficiently large elasticity of intertemporal substitution. One is locally determinate, whereas the other can be locally indeterminate. Furthermore, we show that these balanced growth paths can also be globally indeterminate. (Copyright: Fundación Empresa Pública)
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Bibliographic InfoArticle provided by Fundación SEPI in its journal Investigaciones Economicas.
Volume (Year): 25 (2001)
Issue (Month): 3 (September)
Contact details of provider:
Postal: Investigaciones Economicas Fundación SEPI Quintana, 2 (planta 3) 28008 Madrid Spain
Web page: http://www.fundacionsepi.es/
Find related papers by JEL classification:
- D62 - Microeconomics - - Welfare Economics - - - Externalities
- J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
- E3 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles
- O41 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
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