Sources of U.S. Economic Growth in a World of Ideas

Stanford University Economics Working Paper No. 97-015

42 Pages Posted: 31 Mar 1998

See all articles by Charles I. Jones

Charles I. Jones

Stanford Graduate School of Business; National Bureau of Economic Research (NBER)

Date Written: July 8, 1998

Abstract

At least since 1950, the U.S. economy has benefited from increases in educational attainment, increases in research intensity, and the increased openness and development of the world economy. Such changes suggest, contrary to the conventional view, that the U.S. economy is far from its steady-state balanced growth path. This paper develops a model in which these facts are reconciled with the stability of average U.S. growth rates over the last century. In the model, long-run growth is driven by the worldwide discovery of ideas, which in turn is tied to world population growth. Nevertheless, a constant growth path can temporarily be maintained at a rate greater than the long-run rate provided research intensity and educational attainment rise steadily over time. Growth accounting with this model reveals that 35 percent of U.S. growth between 1965 and 1990 is attributable to the rise in educational attainment, more than 40 percent is attributable to the rise in worldwide research intensity, and only about 20 percent is due to the long-run component of growth related to the increase in world population.

JEL Classification: E23, E30

Suggested Citation

Jones, Charles I., Sources of U.S. Economic Growth in a World of Ideas (July 8, 1998). Stanford University Economics Working Paper No. 97-015. Available at SSRN: https://ssrn.com/abstract=72188 or http://dx.doi.org/10.2139/ssrn.72188

Charles I. Jones (Contact Author)

Stanford Graduate School of Business ( email )

Stanford GSB
655 Knight Way
Stanford, CA 94305-4800
United States
650-725-9265 (Phone)

HOME PAGE: http://www.stanford.edu/~chadj

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
271
Abstract Views
1,935
rank
120,992
PlumX Metrics