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on Economic Growth |
| By: | Yu, Po-yang; Lai, Ching-Chong |
| Abstract: | This paper develops a monetary R&D-driven endogenous growth model featuring endogenous innovation scales and the price-marginal cost markup. To endogenize the step size of quality improvement, we propose a trade-off mechanism between the risk of innovation failure and the benefit of innovation success in R&D firms. Several findings emerge from the analysis. First, a rise in the nominal interest rate decreases economic growth; however, its relationship with social welfare is ambiguous. Second, either strengthening patent protection or raising the professional knowledge of R&D firms leads to an ambiguous effect on economic growth. Third, the Friedman rule of a zero nominal interest rate fails to be optimal in view of the social welfare maximum. Finally, our numerical analysis indicates that the extent of patent protection and the level of an R&D firm’s professional knowledge play a crucial role in determining the optimal interest rate. |
| Keywords: | Intellectual property rights; Economic growth; Endogenous innovation scales; Endogenous markups; Inflation |
| JEL: | E41 L11 O30 O40 |
| Date: | 2022–10–17 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:115016&r=gro |
| By: | Barış Alpaslan; Brendan Burchell |
| Abstract: | Although sociologists have already recognised the gender aspect of social capital, to date it has not yet been systematically investigated in an endogenous growth model. In pursuing this objective theoretically, we draw on Agénor and Canuto (2015) that has offered a three-period (childhood, adulthood, and old age) gender-based Overlapping Generations (OLG) framework, but we explore a different mechanism through which social capital may explain gender equality and prospects for economic growth in Turkey. This paper contributes in several ways to understanding the pivotal role of social capital in the process of economic development. First, social capital gives individuals a great sense of community and feelings of pleasure, and therefore we consider social capital as a possible driving factor of labour productivity. Second, in our model setting, survival rate for adults is determined by the average social capital level of men and women because individuals who are less socially integrated are more likely to have high mortality rates than people with strong ties to their community. Third, we elucidate an important, but understudied, trade-off between time allocated by women to market work and social capital-enhancing activities, and show that these two components of time allocation have opposite effects on intra-household bargaining power. |
| Keywords: | social capital, three-period gender-based OLG model, Turkey |
| JEL: | J16 O41 |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:een:camaaa:2022-57&r=gro |
| By: | Beyer, Robert; Yao, Jiaxiong; Hu, Yingyao |
| JEL: | C10 E01 R12 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc22:264007&r=gro |
| By: | Naudé, Wim (RWTH Aachen University); Nagler, Paula (Erasmus University Rotterdam) |
| Abstract: | We describe Germany's rise as an industrial power in the late 19th century through radical innovation and entrepreneurship, and contrast this with the post-World War II period. This latter period, although it contained the German economic miracle, was nevertheless a period during which innovation slowed down - a somewhat surprising conclusion, but consistent with the decline in business dynamism noted in a growing number of advanced economies. We document this decline using several innovation indicators, and offer four broad, interrelated explanations in a historical context: (i) the innovation system is locked into incremental innovation, (ii) the diffusion of technology is slowing down, (iii) the education system is subject to weaknesses, and (iv) entrepreneurship is stagnating. Implications for policy are noted. Our paper contributes to the literature on the decline in business dynamism and the "great stagnation", to the literature on the historical forces that determine innovation outcomes, and to the literature that seeks to identify what makes an entrepreneurial state. |
| Keywords: | innovation, Germany, entrepreneurship, technology |
| JEL: | N13 N14 O31 O33 |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15607&r=gro |
| By: | Tommaso Giommoni; Gabriel Loumeau |
| Abstract: | This paper studies the long-term effect of taxation on economic geography and development. We rely on a unique natural experiment in place during France’s ancien régime: the salt tax. Introduced in the late 13th century and abrogated by the French Revolution in 1789, the salt tax was not uniformly levied across the French kingdom as its rate varied discontinuously in space. Using a series of rich and original historical data at regular time intervals and very fine spatial resolution since the fifteen century, we estimate a Spatial RDD model. We find that these exogenous tax rate differentials have had large effects on economic geography and development. These effects are, then, confirmed in a DiD analysis, that studies a very large time span (1400-1900 using regular intervals of 25 years) and documents the absence of pre-trends. Most of the effects can still be observed today in population density, firm density, and local average income. |
| Keywords: | taxation, long-term, economic georgraphy, development, spatial discontinuity, salt tax |
| JEL: | H20 N33 O23 J61 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9997&r=gro |