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Uncertainty-driven growth

  • Oikawa, Koki

In this paper, I present a model in which firm-level uncertainty raises aggregate productivity growth. The mechanism for this is learning-by-doing in the research sector: firms undertake research to reduce uncertainty, which results in social knowledge accumulation that improves the productivity of future research. The model explains the positive correlation between TFP growth and dispersion in manufacturing industries.

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Article provided by Elsevier in its journal Journal of Economic Dynamics and Control.

Volume (Year): 34 (2010)
Issue (Month): 5 (May)
Pages: 897-912

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Handle: RePEc:eee:dyncon:v:34:y:2010:i:5:p:897-912
Contact details of provider: Web page: http://www.elsevier.com/locate/jedc

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