Internal increasing returns to scale and economic growth
By: John A. List, Haiwen Zhou.
Contributors: List, John A.; Zhou, Haiwen.; National Bureau of Economic Research.
Series: NBER working paper series -- working paper 12999; Working paper series (National Bureau of Economic Research : Online) -- working paper no. 12999.
Publisher: National Bureau of Economic Research
Published: 2007
Place of publication: Cambridge, MA
Language: eng
Format: Electronic resource
Description: "This study develops a model of endogenous growth based on increasing returns due to firms' technology choices.  Particular attention is paid to the implications of these choices, combined with the substitution of capital for labor, on economic growth in a general equilibrium model in which the R&D sector produces machines to be used for the sector producing final goods.  We show that incorporating oligopolistic competition in the sector producing finals goods into a general equilibrium model with endogenous technology choice is tractable, and we explore the equilibrium path analytically.  The model illustrates a novel manner in which sustained per capita growth of consumption can be achieved -- through continuous adoption of new technologies featuring the substitution between capital and labor.  Further insights of the model are that during the growth process, the size of firms producing final goods increases over time, the real interest rate is constant, and the real wage rate increases over time"--National Bureau of Economic Research web site.
Notes: Title from PDF file as viewed on 6/1/2007.

Includes bibliographical references.

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