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Reexamining the interaction between innovation and capital accumulation

  • Zeng, Jinli

In endogenous growth models with innovation and capital accumulation, Arnold (1998) and Blackburn, Hung and Pozzolo (2000) show that long-run growth of per capita income is independent of innovation activities; it is solely determined by preferences and the human capital accumulation technology. As a result, government policies do not affect long-run growth. This paper develops an endogenous growth model with innovation and (physical and human) capital accumulation to show that long-run growth depends on both innovation and capital accumulation technologies as well as on preferences and that government taxes and subsidies can have effects on the long-run growth rate.

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Article provided by Elsevier in its journal Journal of Macroeconomics.

Volume (Year): 25 (2003)
Issue (Month): 4 (December)
Pages: 541-560

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Handle: RePEc:eee:jmacro:v:25:y:2003:i:4:p:541-560
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/622617

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