Population Growth and Local Home Environment Externality in an Endogenous Growth Model with Two Engines of Growth

Shiro Kuwahara () and Katsunori Yamada ()
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Katsunori Yamada: Graduate School of Economics, Osaka University

No 07-22, Discussion Papers in Economics and Business from Osaka University, Graduate School of Economics

Abstract: This paper presents an endogenous growth model with population growth and an inter-generational spillover of human capital: we consider the ``local home environment externality conceptualized by Galor and Tsiddon (1997a). The model will generate a negative relationship between the population growth rate and the per capita GDP growth rate, which is also present in the data. Furthermore, multiple equilibrium paths will result. As far as we know, this is the first paper that derives a multiplicity of steady growth paths in a model with two sources of growth and the Jones technology. The paper also casts a paradox that the GDP growth rate may be higher in the society without the externality than the one in the economy with externality.

Keywords: population growth; multiple equilibria; R&D; Jones technology; the local home environment externality (search for similar items in EconPapers)
JEL-codes: O11 O31 O41 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2007-06
New Economics Papers: this item is included in nep-cse, nep-dge and nep-env
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Persistent link: https://EconPapers.repec.org/RePEc:osk:wpaper:0722

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