Towards a Disequilibrium Theory of Endogenous Economic Growth
This paper discusses the need for a new approach to economic growth theory. The standard theory of growth-in-equilibrium driven by exogenous, uncaused, productivity gains has an implication that is both unjustified and perverse from a policy perspective: that government intervention of any kind can only introduce constraints and reduce option space, thus decreasing potential growth. It is argued that growth theory should (1) acknowledge the importance of natural resources, especially fossil fuels, as a driver of past and present economic growth, (2) incorporate an explicit recognition that growth is a consequence of technological innovation, especially radical innovation, that often responds to natural resource scarcities or other societal needs and (3) explicitly reflect the fact that the important (i.e. scarce) factors of production in economics can and do change over time, i.e. from a rural ‘cowboy’ economy of the past to an urbanized ‘spaceship’ economy of the future. In short, it should reflect the fact that ‘necessity is the mother of invention’. The first and third of these modifications have been proposed before, but not in combination. The third seems to be new. Copyright Kluwer Academic Publishers 1998
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Volume (Year): 11 (1998)
Issue (Month): 3 (April)
|Contact details of provider:|| Web page: http://www.springerlink.com/link.asp?id=100263|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Paul M Romer, 1999.
"Increasing Returns and Long-Run Growth,"
Levine's Working Paper Archive
2232, David K. Levine.
- Romer, Paul M, 1987. "Growth Based on Increasing Returns Due to Specialization," American Economic Review, American Economic Association, vol. 77(2), pages 56-62, May.
- Robert Ayres, 1994. "On economic disequilibrium and free lunch," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 4(5), pages 435-454, October.
- Heal, Geoffrey M., 1993.
"The optimal use of exhaustible resources,"
Handbook of Natural Resource and Energy Economics,
in: A. V. Kneese† & J. L. Sweeney (ed.), Handbook of Natural Resource and Energy Economics, edition 1, volume 3, chapter 18, pages 855-880
- repec:cup:cbooks:9780521297615 is not listed on IDEAS
- Solow, Robert M, 1974. "The Economics of Resources or the Resources of Economics," American Economic Review, American Economic Association, vol. 64(2), pages 1-14, May.
- Ayres, Robert U. & Miller, Steven M., 1980. "The role of technological change," Journal of Environmental Economics and Management, Elsevier, vol. 7(4), pages 353-371, December.
When requesting a correction, please mention this item's handle: RePEc:kap:enreec:v:11:y:1998:i:3:p:289-300. 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: (Guenther Eichhorn)or (Christopher F. Baum)
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.