Absorption in Human Capital and R&D Effects in an Endogenous Growth Model

Sequeira, Tiago Neves

doi:10.2139/ssrn.999611

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Absorption in Human Capital and R&D Effects in an Endogenous Growth Model

FEUNL Working Paper Series No. 507

24 Pages Posted: 14 Jul 2007

See all articles by Tiago Neves Sequeira

Tiago Neves Sequeira

University of the Interior of Beira - Faculty of Social Sciences and Humanities; Nova School of Business and Economics

Date Written: 2007

Abstract

Until now, in models of endogenous growth with physical capital, human capital and R&D such as in Arnold [Journal of Macroeconomics 20 (1998)] and followers, steady-state growth is independent of innovation activities. We introduce absorption in human capital accumulation and describe the steady-state and transition of the model. We show that this new feature provides an effect of R&D in growth, consumption and welfare. We compare the quantitative effects of R&D productivity with the quantitative effects of Human Capital productivity in wealth and welfare.

Keywords: Human Capital, Absorption, Endogenous Growth, Welfare

JEL Classification: O15, O30, O41

Suggested Citation: Suggested Citation

Neves Sequeira, Tiago, Absorption in Human Capital and R&D Effects in an Endogenous Growth Model (2007). FEUNL Working Paper Series No. 507, Available at SSRN: https://ssrn.com/abstract=999611 or http://dx.doi.org/10.2139/ssrn.999611