Saving and investment in a two-sector model of endogenous growth of a small open economy
We develop a two sector model of endogenous growth. The export sector is the only sector that generates technological progress. Technological knowledge can be used by the import sector. Firms face adjustment costs for investment. The model has well defined equations for the growth rate of capital, and for the growth rate of consumption. The model has a steady state solution. We study the relation between the interest rate and the growth rate. The optimal growth rate is higher than that achieved in the market economy without government. The optimal policy is an investment subsidy in the export sector.
Volume (Year): 13 (1998)
Issue (Month): 2 ()
|Contact details of provider:|| Web page: http://www.colmex.mx/centros/cee/|
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:emx:esteco:v:13:y:1998:i:2:p:197-224. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Rocío Contreras)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.