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Software Production, Human Capital and Endogenous Growth: Theoretical Analysis and Empirical Evidence from India

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  • Supriyo De

Abstract

Propelled by the rise of a vibrant software industry the Indian economy has demonstrated rapid growth since the 1990s. A novel three-sector endogenous growth model that encapsulates the salient features of an information technology oriented economy is developed. The dynamic optimization problem leads to a balanced growth path equilibrium characterized by output, physical capital, software assets, human capital and consumption growing at a uniform rate. Major implications of the model are reflected in empirical evidence from the growth trajectories of Indian states. The human capital production apparatus has a significant impact on economic growth. This has critical policy implications.

Suggested Citation

  • Supriyo De, 2007. "Software Production, Human Capital and Endogenous Growth: Theoretical Analysis and Empirical Evidence from India," DEGIT Conference Papers c012_007, DEGIT, Dynamics, Economic Growth, and International Trade.
  • Handle: RePEc:deg:conpap:c012_007
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    File URL: http://degit.sam.sdu.dk/papers/degit_12/C012_007.pdf
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    References listed on IDEAS

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    Keywords

    endogenous growth; India; information technology; human capital; software;

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