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Vintage Capital Growth Theory: Three Breakthroughs

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  • Raouf Boucekkine
  • David de la Croix and Omar Licandro

Abstract

Vintage capital growth models have been at the heart of growth theory in the 60s. This research line collapsed in the late 60s with the so-called embodiment controversy and the technical sophistication of the vintage models. This paper analyzes the astonishing revival of this literature in the 90s. In particular, it out- lines three methodological breakthroughs explaining this resurgence: a growth accounting revolution, taking advantage of the availability of new time series, an optimal control revolution allowing to safely study vintage capital optimal growth models, and a vintage human capital revolution, along with the rise of economic demography, accounting for the vintage structure of human capital similarly to physical capital age structuring. The related literature is surveyed.

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Bibliographic Info

Paper provided by Barcelona Graduate School of Economics in its series Working Papers with number 565.

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Date of creation: Jun 2011
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Handle: RePEc:bge:wpaper:565

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Keywords: Vintage capital; embodied technical progress; growth accounting; optimal control; endogenous growth; vintage human capital; demography;

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References

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  1. Boucekkine, Raouf & Hritonenko, Natali & Yatsenko, Yuri, 2011. "Scarcity, regulation and endogenous technical progress," Journal of Mathematical Economics, Elsevier, vol. 47(2), pages 186-199, March.
  2. Boucekkine, R. & Germain, M. & Licandro, O., . "Replacement echoes in the vintage capital growth model," CORE Discussion Papers RP -1275, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  3. Raouf BOUCEKKINE & Fernando DEL RIO & Omar LICANDRO, 2001. "Obsolescence and Modernization in the Growth Process," Economics Working Papers ECO2001/18, European University Institute.
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  8. Raouf Boucekkine & David De La Croix & Omar Licandro, 2004. "MODELLING VINTAGE STRUCTURES WITH DDEs: PRINCIPLES AND APPLICATIONS," Mathematical Population Studies, Taylor & Francis Journals, vol. 11(3-4), pages 151-179.
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  16. Raouf Boucekkine & David de la Croix & Dominique Peeters, 2007. "Early Literacy Achievements, Population Density, and the Transition to Modern Growth," Journal of the European Economic Association, MIT Press, vol. 5(1), pages 183-226, 03.
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Cited by:
  1. Schröder, Philipp J.H. & Sørensen, Allan, 2012. "Firm exit, technological progress and trade," European Economic Review, Elsevier, vol. 56(3), pages 579-591.

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