Knowledge and Growth in the Very Long-Run

Holger Strulik ()

Diskussionspapiere der Wirtschaftswissenschaftlichen Fakultät der Universität Hannover from Universität Hannover, Wirtschaftswissenschaftliche Fakultät

Abstract: This paper proposes a theory for the evolution of knowledge diffusion and growth over the very long run. A feedback mechanism between capital accumulation and knowledge spillovers creates a unified growth theory that explains a long epoch of (quasi-) stasis and an epoch of high growth linked by gradual economic take-off. It is shown how the feedback mechanism can explain the Great Divergence, the failure of less developed countries to attract capital from abroad, the productivity slowdown in fully developed countries, and why R&D effort, TFP growth, and income growth are jointly rising along the transition towards modern growth. Finally, it is explained how a First Industrial Revolution, brought forth by increasing propositional knowledge, triggered a Second Industrial Revolution from which onwards technological progress was increasingly produced by market R&D activities.

Keywords: Endogenous Growth; Knowledge Spillovers; R&D; Globalization; Unified Growth Theory; Productivity Slowdown; Roaring Twenties. (search for similar items in EconPapers)
JEL-codes: O10 O30 O40 E22 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-knm and nep-mac
Date: 2009-02

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Persistent link: http://EconPapers.repec.org/RePEc:han:dpaper:dp-414

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