Endogenous Growth, Temporary Equilibrium, and the Direction of Change
Peter Funk ()
Discussion Paper Serie A from University of Bonn, Germany
This article studies the long-run direction of technological change in an endogenous growth model. Development is modeled as a sequence of temporary equilibria in an overlapping generations framework. We introduce a concept of `long-run efficient development' which excludes persistent inefficiencies. The concept is much weaker than short-run or long-run Pareto-efficiency and does not depend on our particular model. The main theorem of the article gives conditions on agents' expectations and preferences and on the evolution of innovation possibilities under which equilibrium development, guided by current prices and profit expectations, is long-run efficient.
Keywords: Endogenous growth; direction of change; temporary general equilibrium; efficient development. (search for similar items in EconPapers)
JEL-codes: D50 D60 O12 O30 O33 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations View citations in EconPapers (6) Track citations by RSS feed
Downloads: (external link)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: http://EconPapers.repec.org/RePEc:bon:bonsfa:506
Access Statistics for this paper
More papers in Discussion Paper Serie A from University of Bonn, Germany Bonn Graduate School of Economics, University of Bonn, Adenauerallee 24 - 26, 53113 Bonn, Germany.
Series data maintained by BGSE Office ().