Reference : Steady-State Growth and the Elasticity of Substitution
Reports : External report
Business & economic sciences : Macroeconomics & monetary economics
http://hdl.handle.net/10993/12085
Steady-State Growth and the Elasticity of Substitution
English
Irmen, Andreas mailto [University of Luxembourg > Faculty of Law, Economics and Finance (FDEF) > Center for Research in Economic Analysis (CREA) >]
2010
CESifo Group Munich
2955
[en] capital accumulation; elasticity of substitution; direction of technical change; neoclassical growth
[en] In a neoclassical economy with endogenous capital- and labor-augmenting technical change the steady-state growth rate of output per worker is shown to increase in the elasticity of substitution between capital and labor. This confirms the assessment of Klump and de La Grandville (2000) that the elasticity of substitution is a powerful engine of economic growth. However, unlike their findings my result applies to the steady-state growth rate. Moreover, it does not hinge on particular assumptions on how aggregate savings come about. It holds for any household sector allowing savings to grow at the same rate as aggregate output.
Researchers ; Students
http://hdl.handle.net/10993/12085
http://ideas.repec.org/p/ces/ceswps/_2955.html
CESifo Working Paper Series

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