Merit and rent in a growing economy

Enrico Minelli

Economics Letters, 2017, vol. 151, issue C, 107-110

Abstract: In the framework of Romer’s (1990) growth model, we endogenize human capital accumulation as the risky outcome of an effort choice. Policies favouring the accumulation of physical capital may reduce the incentives to effort, leading the economy on a balanced path with a high capital intensity and a low growth rate.

Keywords: Growth; Endogenous technological change; Incentives (search for similar items in EconPapers)
JEL-codes: D52 D9 E2 O3 (search for similar items in EconPapers)
Date: 2017
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:151:y:2017:i:c:p:107-110

DOI: 10.1016/j.econlet.2016.12.027

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