Endogenous Growth: Analytical Review of its Generating Mechanisms

Maria João Ribeiro ()
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Maria João Ribeiro: Universidade do Minho, http://www.eeg.uminho.pt
Authors registered in the RePEc Author Service: Maria Thompson

No 4/2003, NIPE Working Papers from NIPE - Universidade do Minho

Abstract: This paper consists of an analytical review of the most relevant endogenous growth models. The objective of this literature review is to discuss analytically and understand, in an integrated form, the main mechanisms, identified in the existing literature, that generate endogenous growth. Endogenous or new growth theory has, so far, produced three main types of mechanisms through which endogenous sustained positive economic growth is made possible. One strategy brings a theory of innovations or R&D into the growth model. In this type of model, endogenously determined technological progress is the engine of economic growth. The second mechanism delivers sustained positive growth through the introduction of an endogenously determined accumulation of human capital. In this kind of model, the source of long-run per-capita growth is human capital accumulation. And a third way to obtain endogenous growth is simply to abandon one of the standard assumptions of the neoclassical model, more precisely the assumption of diminishing returns to capital.

Keywords: non-diminishing returns to capital; endogenous growth; research and development (R&D); human capital accumulation; Inada conditions. (search for similar items in EconPapers)
JEL-codes: D4 D9 O0 O4 (search for similar items in EconPapers)
Date: 2003
New Economics Papers: this item is included in nep-dev
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Citations: View citations in EconPapers (1)

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