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Equilibrium Determinacy of a Two-Sector AK Model

Author

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  • Mino, Kazuo

Abstract

This paper explores a two-sector model of endogenous growth with AK technologies and production externalities. Unlike the standard one-sector AK model, the two-sector model may involve the relative price dynamics, so that there may exist transitional processes. It is shown that under certain conditions for the relative magnitudes of factor intensities, the balanced growth equilibrium exhibits local indeterminacy.

Suggested Citation

  • Mino, Kazuo, 1998. "Equilibrium Determinacy of a Two-Sector AK Model," MPRA Paper 17323, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:17323
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    File URL: https://mpra.ub.uni-muenchen.de/17323/1/MPRA_paper_17323.pdf
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    References listed on IDEAS

    as
    1. Romer, Paul M, 1986. "Increasing Returns and Long-run Growth," Journal of Political Economy, University of Chicago Press, vol. 94(5), pages 1002-1037, October.
    2. Benhabib, Jess & Farmer, Roger E. A., 1996. "Indeterminacy and sector-specific externalities," Journal of Monetary Economics, Elsevier, vol. 37(3), pages 421-443, June.
    3. Rebelo, Sergio, 1991. "Long-Run Policy Analysis and Long-Run Growth," Journal of Political Economy, University of Chicago Press, vol. 99(3), pages 500-521, June.
    4. Benhabib, Jess & Gali, Jordi, 1995. "On growth and indeterminacy: some theory and evidence," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 43(1), pages 163-211, December.
    5. Mino, Kazuo, 1996. "Analysis of a Two-Sector Model of Endogenous Growth with Capital Income Taxation," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 37(1), pages 227-251, February.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Two-Sector AK model; endogenous growth; equilibrium determinacy;

    JEL classification:

    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

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