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R\&D-based Growth in the Post-modern Era

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  • Strulik, Holger
  • Prettner, Klaus
  • Prskawetz, Alexia

Abstract

Conventional R\&D-based growth theory suggests that productivity growth is positively correlated with population size or population growth, an implication which is hard to see in the data. Here we integrate microfounded fertility and schooling into an otherwise standard R\&D-based growth model. We then show how a Beckerian child quality-quantity trade-off explains why higher growth of productivity and income per capita are associated with lower population growth. The medium-run prospects for future economic growth - when fertility is going to be below replacement level in virtually all fully developed countries - are thus much better than predicted by conventional R\&D-based growth theory.

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  • Strulik, Holger & Prettner, Klaus & Prskawetz, Alexia, 2010. "R\&D-based Growth in the Post-modern Era," Hannover Economic Papers (HEP) dp-457, Leibniz Universität Hannover, Wirtschaftswissenschaftliche Fakultät.
  • Handle: RePEc:han:dpaper:dp-457
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    Cited by:

    1. Prettner, Klaus & Bloom, David E. & Strulik, Holger, 2013. "Declining fertility and economic well-being: Do education and health ride to the rescue?," Labour Economics, Elsevier, vol. 22(C), pages 70-79.
    2. Barbara Annicchiarico & Alessandra Pelloni, 2014. "Productivity growth and volatility: how important are wage and price rigidities?," Oxford Economic Papers, Oxford University Press, vol. 66(1), pages 306-324, January.
    3. repec:got:cegedp:139 is not listed on IDEAS
    4. Holger Strulik & Klaus Prettner & Alexia Prskawetz, 2013. "The past and future of knowledge-based growth," Journal of Economic Growth, Springer, vol. 18(4), pages 411-437, December.
    5. Klaus Prettner & Timo Trimborn, 2012. "Demographic Change and R&D-based Economic Growth: Reconciling Theory and Evidence," DEGIT Conference Papers c017_006, DEGIT, Dynamics, Economic Growth, and International Trade.
    6. Thomas Fent & Belinda Aparicio Diaz & Alexia Prskawetz, 2013. "Family policies in the context of low fertility and social structure," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 29(37), pages 963-998.
    7. Prettner, Klaus, 2012. "Public education, technological change and economic prosperity: semi-endogenous growth revisited," VfS Annual Conference 2012 (Goettingen): New Approaches and Challenges for the Labor Market of the 21st Century 65414, Verein für Socialpolitik / German Economic Association.
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    9. Ken-ichi Hashimoto & Ken Tabata, 2013. "Rising Longevity, Human Capital and Fertility in Overlapping Generations Version of an R&D-based Growth Model," Discussion Paper Series 104, School of Economics, Kwansei Gakuin University, revised May 2013.
    10. Prettner, Klaus, 2012. "Public education and economic prosperity: Semi-endogenous growth revisited," ECON WPS - Working Papers in Economic Theory and Policy 02/2012, TU Wien, Institute of Statistics and Mathematical Methods in Economics, Economics Research Unit.
    11. Prettner, Klaus, 2013. "Public education, technological change and economic prosperity," Center for European, Governance and Economic Development Research Discussion Papers 149, University of Goettingen, Department of Economics.

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    More about this item

    Keywords

    endogenous growth; R&D; declining population; fertility; schooling; human capital; post-modern society; post-transitional fertility;
    All these keywords.

    JEL classification:

    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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