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Internal Learning By Doing And Economic Growth

Author

Listed:
  • Carmen Alvarez Albelo

    () (Universidad de La Laguna)

  • Antonio Manresa

    (Universitat de Barcelona)

Abstract

This paper analyses the consequences for growth during the transitional period of considering the learning-by-doing process proposed by Arrow (1962) as internal, instead of as an externality. To do this, it develops a simple endogenous growth model with human capital accumulation through external and internal learning processes. The calibrated model delivers two features of the Japanese growth experience: slow convergence, and negative correlation between the growth rate of per capita GDP and investment share. The crucial implication of internal learning-by-doing is the double role of physical investment that operates reducing diminishing returns to physical capital.

Suggested Citation

  • Carmen Alvarez Albelo & Antonio Manresa, 2005. "Internal Learning By Doing And Economic Growth," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 30(2), pages 1-23, December.
  • Handle: RePEc:jed:journl:v:30:y:2005:i:2:p:1-23
    as

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    File URL: http://www.jed.or.kr/full-text/30-2/J01_685.PDF
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    References listed on IDEAS

    as
    1. Henry E. Siu & Rodolfo E. Manuelli & Larry E. Jones, 2000. "Growth and business cycles," Staff Report 271, Federal Reserve Bank of Minneapolis.
    2. Sebastian Edwards, 1995. "Why are Saving Rates so Different Across Countries?: An International Comparative Analysis," NBER Working Papers 5097, National Bureau of Economic Research, Inc.
    3. Alvarez Albelo, Carmen D., 1999. "Complementarity between physical and human capital, and speed of convergence," Economics Letters, Elsevier, vol. 64(3), pages 357-361, September.
    4. Norman Loayza & Klaus Schmidt-Hebbel & Luis Servén, 2000. "What Drives Private Saving Across the World?," The Review of Economics and Statistics, MIT Press, vol. 82(2), pages 165-181, May.
    5. Rosen, Sherwin, 1985. "Implicit Contracts: A Survey," Journal of Economic Literature, American Economic Association, vol. 23(3), pages 1144-1175, September.
    6. Madsen, Jakob B., 2002. "The causality between investment and economic growth," Economics Letters, Elsevier, vol. 74(2), pages 157-163, January.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Rao, B. Bhaskara, 2010. "Estimates of the steady state growth rates for selected Asian countries with an extended Solow model," Economic Modelling, Elsevier, vol. 27(1), pages 46-53, January.
    2. Jeffrey A. Edwards & Alfredo A. Romero & Zagros Madjd-Sadjadi, 2016. "Foreign direct investment, economic growth, and volatility: a useful model for policymakers," Empirical Economics, Springer, vol. 51(2), pages 681-705, September.
    3. Wei-Bin ZHANG, 2016. "Tourism and economic structural change with endogenous wealth and human capital and elastic labor supply," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania - AGER, vol. 0(4(609), W), pages 103-126, Winter.
    4. Wei-Bin ZHANG, 2016. "Tourism and economic structural change with endogenous wealth and human capital and elastic labor supply," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania - AGER, vol. 0(4(609), W), pages 103-126, Winter.

    More about this item

    Keywords

    Internal LBD; Endogenous Growth; Return to Saving; Convergence Speed; Investment Share and Growth Rate;

    JEL classification:

    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
    • O50 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - General

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