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Lecture Notes on Economic Growth(I): Introduction to the Literature and Neoclassical Models

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  • Xavier Sala-i-Martin

Abstract

This is a survey of the literature on Economic Growth. In the introduction we analyze the main differences between exogenous and endogenous growth models using fixed savings rate analysis. We argue that in order to have endogenous growth there must be constant returns to the factors that can be accumulated. A graphical tool is then developed to show that changes in the savings rate have different effects on long run growth in the two kinds of models; we show that only endogenous growth models are affected by shifts in the savings rate. We then explore two versions of the Raasey-Cass-Koopmans neoclassical model where savings are determined optimally; one with exogenous productivity growth and one without.

Suggested Citation

  • Xavier Sala-i-Martin, 1990. "Lecture Notes on Economic Growth(I): Introduction to the Literature and Neoclassical Models," NBER Working Papers 3563, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:3563 Note: EFG
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    1. Horst & Siebert, 1992. "Why has potential growth declined? The case of Germany," Proceedings - Economic Policy Symposium - Jackson Hole, Federal Reserve Bank of Kansas City, pages 41-55.
    2. Ramser, Hans Jürgen, 1992. "Grundlagen der neuen Wachstumstheorie," Discussion Papers, Series I 261, University of Konstanz, Department of Economics.
    3. Gylfason, Thorvaldur, 1998. "Output gains from economic stabilization," Journal of Development Economics, Elsevier, vol. 56(1), pages 81-96, June.
    4. Bergman, Mats & Johansson, Per, 2000. "Strategic Investments in the Pulp and Paper Industry: A Count Data Regression Analysis," Umeå Economic Studies 536, Umeå University, Department of Economics.
    5. Carlo Carraro, 1998. "New Economic Theories," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 11(3), pages 365-381, April.
    6. Lucio Sarno & Mark Taylor, 1998. "Exchange controls, international capital flows and saving-investment correlations in the UK: An empirical investigation," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 134(1), pages 69-98, March.
    7. Stolpe, Michael, 1992. "Ansätze der neuen Wachstumstheorie: ein Literaturüberblick," Kiel Working Papers 508, Kiel Institute for the World Economy (IfW).
    8. Verma, R. & Wilson, E.J., 2005. "Savings, Investment, Foreign Inflows and Economic Growth of the Indian Economy 1950-2001," Economics Working Papers wp05-23, School of Economics, University of Wollongong, NSW, Australia.
    9. Siebert, Horst, 1992. "Why has potential growth declined? The case of Germany. A note," Kiel Working Papers 525, Kiel Institute for the World Economy (IfW).
    10. Charles R. Hulten & Robert M. Schwab, 1993. "Endogenous Growth, Public Capital, and the Convergence of Regional Manufacturing Industries," NBER Working Papers 4538, National Bureau of Economic Research, Inc.
    11. Bernhard Herz & Werner Roger, 1995. "Economic growth and convergence in Germany," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 131(1), pages 132-143, March.
    12. Bode, Eckhardt, 1996. "Ursachen regionaler Wachstumsunterschiede: wachstumstheoretische Erklärungsansätze," Kiel Working Papers 740, Kiel Institute for the World Economy (IfW).
    13. Robin Johnson & W. A. Razzak & Steven Stillman, 2007. "Has New Zealand benefited from its investments in research & development?," Applied Economics, Taylor & Francis Journals, vol. 39(19), pages 2425-2440.
    14. Easterly, William, 1994. "Economic stagnation, fixed factors, and policy thresholds," Journal of Monetary Economics, Elsevier, vol. 33(3), pages 525-557, June.
    15. den Butter, F. A. G. & Wollmer, F. J., 1996. "An empirical model for endogenous technology in the Netherlands," Economic Modelling, Elsevier, vol. 13(1), pages 15-40, January.
    16. Zahra Sheidaei & Mohammadnabi Shahiki Tash, 2014. "The Cumulative Effect of Human Capital on Economic Growth: Using Panel Data Method," Romanian Economic Journal, Department of International Business and Economics from the Academy of Economic Studies Bucharest, vol. 17(52), pages 95-115, June.
    17. Schalk Hans Joachim & Untiedt Gerhard & Lüschow Jörg, 1995. "Technische Effizienz, Wachstum und Konvergenz in den Arbeitsmarktregionen der Bundesrepublik Deutschland (West). Eine ökonometrische Analyse für die Verarbeitende Industrie mit einem „Frontier Product," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 214(1), pages 25-49, February.
    18. Cooray, Arusha & Paradiso, Antonio & Truglia, Francesco Giovanni, 2013. "Do countries belonging to the same region suggest the same growth enhancing variables? Evidence from selected South Asian countries," Economic Modelling, Elsevier, vol. 33(C), pages 772-779.
    19. James A Roumasset & Lee H Endress, 2000. "Sustainable Development Without Constraints," Working Papers 200009, University of Hawaii at Manoa, Department of Economics.
    20. Wollmer, F.J. & Butter, F.A.G. den & Hassink, W.H.J., 1991. "Technical progress, endogenous growth and labour productivity : a survey," Serie Research Memoranda 0075, VU University Amsterdam, Faculty of Economics, Business Administration and Econometrics.
    21. Buch, Claudia M., 1994. "Insolvency costs and incomplete information in commercial banks: Implications for financial reform in Eastern Europe," Kiel Working Papers 616, Kiel Institute for the World Economy (IfW).
    22. van Bergeijk, Peter A. G. & van Hagen, Gilbert H. A. & de Mooij, Ruud A. & van Sinderen, Jarig, 1997. "Endogenizing technological progress: The MESEMET Model," Economic Modelling, Elsevier, vol. 14(3), pages 341-367, July.
    23. Hartler, Christina, 1991. "Agricultural Pricing and Growth," Working Paper Series 307, Research Institute of Industrial Economics.
    24. Oyama, Masako, 2002. "Capital Market Imperfection and Economic Growth," Discussion Paper 105, Center for Intergenerational Studies, Institute of Economic Research, Hitotsubashi University.
    25. Chaudhri, D.P. & Wilson, E.J., 2000. "Agricultural Growth, Employment and Poverty: Theoretical and Empirical Explorations with Indian data (1970-1993)," Economics Working Papers wp00-06, School of Economics, University of Wollongong, NSW, Australia.

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