Transitional Dynamics in an R&D-based Growth Model with Natural Resources

Thanh Le and Cuong Le van

Documents de travail du Centre d'Economie de la Sorbonne from Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne

Abstract: Upon introducing natural resources, both renewable and non-renewable, into an endogenous growth framework with R&D, this paper derives the transitional dynamics of an economy towards its long-run equilibrium. Using the Euler - Lagrange framework, this paper has succesfully figured out the optimal paths of the economy. It then shows the existence and uniqueness of a balanced growth path for each type of resources. The steady state is shown to be of a saddle point stability. Along the balanced growth path, it is found that a finite size resource sector coexists with other continuously growing sectors. The paper then examines long-run responses of the economy to various changes pertaining to innovative production condition, resource sector parameters as well as rate of time preference. It also shows that positive long-run growth will be sustained regardless the type of resources used

Keywords: R&D-based growth; natural resources; vertical innovation; transitional dynamics (search for similar items in EconPapers)
JEL-codes: O13 O31 O41 (search for similar items in EconPapers)
Pages: 32 pages
Date: 2014-10
New Economics Papers: this item is included in nep-ene, nep-gro and nep-ino
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Downloads: (external link)
ftp://mse.univ-paris1.fr/pub/mse/CES2014/14075.pdf (application/pdf)

Related works:
Journal Article: Transitional dynamics in an R&D-based growth model with natural resources (2016)
Working Paper: Transitional dynamics in an R&D-based growth model with natural resources (2016)
Working Paper: Transitional dynamics in an R&D-based growth model with natural resources (2016)
Working Paper: Transitional dynamics in an R&D-based growth model with natural resources (2016)
Working Paper: Transitional Dynamics in an R&D-based Growth Model with Natural Resources (2014)
Working Paper: Transitional Dynamics in an R&D-based Growth Model with Natural Resources (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:mse:cesdoc:14075

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