Endogenous growth, semi-endogenous growth... or both? A simple hybrid model

Guido Cozzi

Economics Letters, 2017, vol. 154, issue C, 28-30

Abstract: First generation endogenous growth models had the counterfactual implication that the long-term growth of per-capita GDP increased with the population size. Two influential growth paradigms, the semi-endogenous and the second generation fully endogenous, eliminated this strong scale effect. Both solutions have useful aspects and insights, but very different policy implications. This paper combines both approaches into a single hybrid model class, and shows that no matter the weight assigned to each paradigm, the long-run predictions of the semi-endogenous policy dominate with high enough population growth rates, while the long-run predictions of the fully endogenous policy dominate at low population growth rates.

Keywords: Strong scale effect; Semi-endogenous growth; Fully endogenous growth (search for similar items in EconPapers)
JEL-codes: O30 O40 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (24)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:154:y:2017:i:c:p:28-30

DOI: 10.1016/j.econlet.2017.02.019

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