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Endogenous growth, semi-endogenous growth... or both? A simple hybrid model

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  • Cozzi, Guido

Abstract

First generation endogenous growth models had the counterfactual implication that the long-term growth of per-capita GDP increased with the population size. Two influential growth paradigms, the semi-endogenous and the second generation fully endogenous, eliminated this strong scale effect. Both solutions have useful aspects and insights, but very different policy implications. This paper combines both approaches into a single hybrid model class, and shows that no matter the weight assigned to each paradigm, the long-run predictions of the semi-endogenous policy dominate with high enough population growth rates, while the long-run predictions of the fully endogenous policy dominate at low population growth rates.

Suggested Citation

  • Cozzi, Guido, 2017. "Endogenous growth, semi-endogenous growth... or both? A simple hybrid model," Economics Letters, Elsevier, vol. 154(C), pages 28-30.
  • Handle: RePEc:eee:ecolet:v:154:y:2017:i:c:p:28-30
    DOI: 10.1016/j.econlet.2017.02.019
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    References listed on IDEAS

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    Cited by:

    1. repec:eee:ecolet:v:155:y:2017:i:c:p:89-91 is not listed on IDEAS
    2. Ziesemer, Thomas, 2017. "Testing linear growth rate formulas of non-scale endogenous growth models," MERIT Working Papers 036, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    3. Cozzi, Guido, 2017. "Combining semi-endogenous and fully endogenous growth: A generalization," Economics Letters, Elsevier, vol. 155(C), pages 89-91.

    More about this item

    Keywords

    Strong scale effect; Semi-endogenous growth; Fully endogenous growth;

    JEL classification:

    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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