Factor substitution and long-run growth in the Lucas model with elastic labor supply

Manuel Gómez

Economics Letters, 2017, vol. 159, issue C, 180-184

Abstract: We show that there exists a positive (resp., negative) relationship between the elasticity of factor substitution and long-run growth if the baseline ratio of physical capital to effective labor is above (resp., below) its steady-state value in the Lucas model with elastic labor supply.

Keywords: Elasticity of substitution; Endogenous growth; Human capital (search for similar items in EconPapers)
JEL-codes: E21 O41 (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:159:y:2017:i:c:p:180-184

DOI: 10.1016/j.econlet.2017.08.004

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