Gerogescu-Roegen versus Solow/Stiglitz and the Convergence to the Cobb-Douglas
AbstractAbstract: The value of the elasticity of substitution of capital for resources is a crucial element in the debate over whether continual growth is possible. It is generally held that the elasticity has to be at least one to permit continual growth and that there is no way of estimating this outside the range of the data. This paper presents a model in which the elasticity is determined endogenously and may converge to one. It is concluded that the general opinion is wrong: that the possibility of continual growth does not depend on the exogenously given value of the elasticity and that the value of the elasticity outside the range of the data can be studied by econometric methods.
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Bibliographic InfoPaper provided by Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC) in its series UFAE and IAE Working Papers with number 489.01.
Date of creation: 15 Jun 2001
Date of revision:
Exhaustible resources; elasticity of substitution; innovation possibility frontier;
Find related papers by JEL classification:
- E13 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Neoclassical
- O13 - Economic Development, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
- Q30 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2001-11-27 (All new papers)
- NEP-DEV-2001-11-27 (Development)
- NEP-ENT-2001-11-27 (Entrepreneurship)
- NEP-NET-2001-11-27 (Network Economics)
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