The Republican Spirit of Innovism and Scale-Free Growth

Heng-Fu Zou ()

No 805, CEMA Working Papers from China Economics and Management Academy, Central University of Finance and Economics

Abstract: This paper develops a continuous-time growth model in which the central driver of modern economic progress is a cumulative stock of liberal ideas and institutions-the republican spirit of innovism. This stock combines dignity for ordinary people, liberty of entry and speech, and the prospect of fair reward, echoing the arguments of McCloskey, Phelps, Landes, and Mokyr. Liberal-ideas capital raises productivity and also enters directly into well-being by making life richer in meaning and opportunity. A share of labor is devoted to building and sustaining this liberal environment, while the rest produces goods. The model shows that long-run growth depends entirely on the growth of the liberal-ideas stock and on society's willingness to devote effort to sustaining it. Economies that place high value on dignity, openness, and creative initiative converge to paths of sustained enrichment, while those that neglect or erode liberal institutions fall into stagnation. Small differences in cultural and institutional commitment can therefore generate large and persistent differences in growth outcomes.

Keywords: Republican spirit of innovism; liberal ideas capital; nonseparable preferences; endogenous growth; institutions and culture; Great Enrichment (search for similar items in EconPapers)
JEL-codes: N10 O11 O40 O43 P16 Z13 (search for similar items in EconPapers)
Pages: 17 pages
Date: 2025-12-18
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