EconPapers    
Economics at your fingertips  
 

Externalities and Growth

Pete Klenow and Andres Rodriguez-Clare ()

Chapter 11 in Handbook of Economic Growth, 2005, vol. 1, Part A, pp 817-861 from Elsevier

Abstract: Externalities play a central role in most theories of economic growth. We argue that international externalities, in particular, are essential for explaining a number of empirical regularities about growth and development. Foremost among these is that many countries appear to share a common long run growth rate despite persistently different rates of investment in physical capital, human capital, and research. With this motivation, we construct a hybrid of some prominent growth models that have international knowledge externalities. When calibrated, the hybrid model does a surprisingly good job of generating realistic dispersion of income levels with modest barriers to technology adoption. Human capital and physical capital contribute to income differences both directly (as usual), and indirectly by boosting resources devoted to technology adoption. The model implies that most of income above subsistence is made possible by international diffusion of knowledge.

JEL-codes: O0 (search for similar items in EconPapers)
Date: 2005
References: Add references at CitEc
Citations: View citations in EconPapers (101) Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/B7P5F ... 4bd0c088f6edf6864ae3
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Externalities and Growth (2004) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:grochp:1-11

Access Statistics for this chapter

More chapters in Handbook of Economic Growth from Elsevier
Bibliographic data for series maintained by Catherine Liu ().

 
Page updated 2021-11-06
Handle: RePEc:eee:grochp:1-11