Debt, Corruption, R&D and Growth in Developing Countries

Charles-Henri DiMaria and Cuong Le van

Papiers d'Economie Mathématique et Applications from Université Panthéon-Sorbonne (Paris 1)

Abstract: This paper analyzes optimal paths in a one-sector growth model when the technology is not convex. In such a case, we prove that optimal paths converge to the upper steady state iff the initial wealth is above a critical level. Then we first show that thanks to debt and/or R&D the poverty trap may be avoided. Second, we introduce a distorsion : corruption which mostly has dramatic consequences on growth. These results may explain why empirical works lead to the conclusion of non convergence in large cross-country samples.

Keywords: CORRUPTION; DEPT; DEVELOPING COUNTRIES; POVERTY (search for similar items in EconPapers)
JEL-codes: D73 F34 I32 O11 O32 (search for similar items in EconPapers)
Pages: 32 pages
Date: 1999
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Citations: View citations in EconPapers (1)

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Working Paper: Debt, corruption, R&D and growth in developing countries (1998)
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Persistent link: https://EconPapers.repec.org/RePEc:fth:pariem:1999.36

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