R&D-Based Growth in the Post-Modern Era

Leibniz Universitat Hannover Discussion Paper No. 454

29 Pages Posted: 3 Mar 2011 Last revised: 26 Aug 2011

See all articles by Holger Strulik

Holger Strulik

University of Goettingen (Gottingen) - School of Law, Economics, Social Sciences

Alexia Prskawetz

Austrian Academy of Sciences - Vienna Institute of Demography

Klaus Prettner

Institute of Economics; University of Goettingen (Gottingen); University of Vienna - Austrian Academy of Sciences; Vienna University of Technology - Institute for Mathematical Methods in Economics

Date Written: August 2011

Abstract

R&D-based growth theory suggests that productivity growth is positively correlated with population size or population growth, an implication which is hard to see in the data. Here we integrate micro-founded fertility and schooling into an otherwise standard R&D-based growth model. We then show how a Beckerian child quality-quantity trade-off explains why higher growth of productivity and income per capita are associated with lower population growth. The medium-run prospects for future economic growth - when fertility is going to be below replacement level in virtually all fully developed countries - are thus much better than predicted by conventional R&D-based growth theory.

Keywords: R&D, unfi ed growth theory, declining population, fertility, schooling, human capital, post-modern society

JEL Classification: J13, J24, O10, O30, O40

Suggested Citation

Strulik, Holger and Fürnkranz-Prskawetz, Alexia and Prettner, Klaus, R&D-Based Growth in the Post-Modern Era (August 2011). Leibniz Universitat Hannover Discussion Paper No. 454, Available at SSRN: https://ssrn.com/abstract=1773844 or http://dx.doi.org/10.2139/ssrn.1773844

Holger Strulik (Contact Author)

University of Goettingen (Gottingen) - School of Law, Economics, Social Sciences ( email )

Germany

Alexia Fürnkranz-Prskawetz

Austrian Academy of Sciences - Vienna Institute of Demography ( email )

Prinz Eugenstr. 8-10
Vienna, 1040
Austria

Klaus Prettner

Institute of Economics ( email )

Fruwirthstr. 48
Stuttgart, 70599
Germany

University of Goettingen (Gottingen) ( email )

Platz der Gottinger Sieben 3
Gottingen, D-37073
Germany

University of Vienna - Austrian Academy of Sciences ( email )

Sonnenfelsgasse 19/2
Wien, Osterreich A-1010
Austria

Vienna University of Technology - Institute for Mathematical Methods in Economics ( email )

Argentinierstr. 8
Vienna, 1040
Austria

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