Endogenous Economic Growth with Education Subsidies

Wei-Bin Zhang

International Journal of Emerging Trends in Social Sciences, 2018, vol. 2, issue 1, 10-16

Abstract: The purpose of this study is to examine existence of business fluctuations in a growth model of endogenous wealth and human capital with government’s subsidy policies on education by Zhang (2016). Zhang synthesized the Solow growth model and the Uzawa-Lucas two-sector model and took account of three ways of accumulating human capital: learning by producing, learning by education, and learning by consuming. This paper generalizes Zhang’s model by allowing all the time-independent parameters to be time-dependent. It examines the relationship between growth and taxation with different time-dependent exogenous shocks. We simulate the model to demonstrate existence of equilibrium points, motion of the dynamic system, and oscillations due to different exogenous shocks.

Keywords: Periodic shocks; Business cycles; Learning by consuming; Learning by education; Government subsidy; Propensity to receive education. (search for similar items in EconPapers)
Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:spi:ijetss:v:2:y:2018:i:1:p:10-16:id:68

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