Endogenous Factor Income Distribution - When Piketty meets Romer -

Scientific Conference (2016)

Endogenous Factor Income Distribution - When Piketty meets Romer -

Scientific Conference (2016)

Population Aging and Innovation: Do Old Societies Think New Ideas?

Presentation (2015, June)

This research advances the hypothesis that at the individual level "old people think old ideas" whereas at the aggregate level "old societies think new ideas." More precisely, we empirically establish the ... [more ▼]

This research advances the hypothesis that at the individual level "old people think old ideas" whereas at the aggregate level "old societies think new ideas." More precisely, we empirically establish the following three hypotheses: i) population aging has a hump-shaped effect on innovation, ii) old societies foster new ideas, and iii) the effect of population aging on innovation operates partly through a favorable attitude towards new ideas and creativity. Our results falsify the often encountered vision according to which old societies have old ideas. Moreover, they emphasize that innovation activity in aging societies is in part driven by cultural attitudes. [less ▲]

Population Aging and Innovation: Do Old Societies Think New Ideas?

Scientific Conference (2015, March)

This research advances the hypothesis that at the individual level "old people think old ideas" whereas at the aggregate level "old societies think new ideas." More precisely, we empirically establish the ... [more ▼]

This research advances the hypothesis that at the individual level "old people think old ideas" whereas at the aggregate level "old societies think new ideas." More precisely, we empirically establish the following three hypotheses: i) population aging has a hump-shaped effect on innovation, ii) old societies foster new ideas, and iii) the effect of population aging on innovation operates partly through a favorable attitude towards new ideas and creativity. Our results falsify the often encountered vision according to which old societies have old ideas. Moreover, they emphasize that innovation activity in aging societies is in part driven by cultural attitudes. [less ▲]

Endogenous Capital- and Labor-Augmenting Technical Change in the Neoclassical Growth Model

Presentation (2015)

The determinants of the direction of technical change and their implications for economic growth and economic policy are studied in the one-sector neoclassical growth model of Ramsey, Cass, and Koopmans ... [more ▼]

The determinants of the direction of technical change and their implications for economic growth and economic policy are studied in the one-sector neoclassical growth model of Ramsey, Cass, and Koopmans extended to allow for endogenous capital- and labor-augmenting technical change. We develop a novel micro-foundation for the competitive production sector that rests on the idea that the fabrication of output requires tasks to be performed by capital and labor. Firms may engage in innovation investments that increase the productivity of capital and labor in the performance of their respective tasks. These investments are associated with new technological knowledge that accumulates over time and sustains long-run growth. We show that the equilibrium allocation is not Pareto-efficient since both forms of technical change give rise to an inter-temporal knowledge externality. An appropriate policy of investment subsidies may implement the efficient allocation. [less ▲]

A Generalized Steady-State Growth Theorem

Scientific Conference (2015)

Uzawa’s steady-state growth theorem (Uzawa (1961)) is generalized to a neoclassical economy that uses current output, e. g., to create technical progress or to manufacture intermediates. The difference ... [more ▼]

Uzawa’s steady-state growth theorem (Uzawa (1961)) is generalized to a neoclassical economy that uses current output, e. g., to create technical progress or to manufacture intermediates. The difference between aggregate final-good production and these resources is referred to as net output. The new generalized steady-state growth theorem holds since net output exhibits constant returns to scale in capital and labor. This insight provides an understanding for why technical change is labor-augmenting in steady state even if capital-augmenting technical change is feasible. By example, this point is made for three recent growth models that allow for endogenous capital- and labor-augmenting technical change, namely, Irmen (2013), Acemoglu (2003), and Acemoglu (2009), Chapter 15. The reduced form of these models is shown to be consistent with the generalized steady-state growth theorem. [less ▲]

Endogenous Capital- and Labor-Augmenting Technical Change in the Neoclassical Growth Model

E-print/Working paper (2015)

The determinants of the direction of technical change and their implications for economic growth and economic policy are studied in the one-sector neoclassical growth model of Ramsey, Cass, and Koopmans ... [more ▼]

The determinants of the direction of technical change and their implications for economic growth and economic policy are studied in the one-sector neoclassical growth model of Ramsey, Cass, and Koopmans extended to allow for endogenous capital- and labor-augmenting technical change. We develop a novel micro-foundation for the competitive production sector that rests on the idea that the fabrication of output requires tasks to be performed by capital and labor. Firms may engage in innovation investments that increase the productivity of capital and labor in the performance of their respective tasks. These investments are associated with new technological knowledge that accumulates over time and sustains long-run growth. We show that the equilibrium allocation is not Pareto-efficient since both forms of technical change give rise to an inter-temporal knowledge externality. An appropriate policy of investment subsidies may implement the efficient allocation. [less ▲]

A Generalized Steady-State Growth Theorem

Scientific Conference (2015)

Uzawa’s steady-state growth theorem (Uzawa (1961)) is generalized to a neoclassical economy that uses current output, e. g., to create technical progress or to manufacture intermediates. The difference ... [more ▼]

Uzawa’s steady-state growth theorem (Uzawa (1961)) is generalized to a neoclassical economy that uses current output, e. g., to create technical progress or to manufacture intermediates. The difference between aggregate final-good production and these resources is referred to as net output. The new generalized steady-state growth theorem holds since net output exhibits constant returns to scale in capital and labor. This insight provides an understanding for why technical change is labor-augmenting in steady state even if capital-augmenting technical change is feasible. By example, this point is made for three recent growth models that allow for endogenous capital- and labor-augmenting technical change, namely, Irmen (2013), Acemoglu (2003), and Acemoglu (2009), Chapter 15. The reduced form of these models is shown to be consistent with the generalized steady-state growth theorem. [less ▲]

The Past and the Future of Economic Growth

Presentation (2014, October 28)

The world’s economic history has largely been a history of stagnation. The phase of sustained growth was only ignited in the second half of the 18th century by the Industrial Revolution in Britain. Since ... [more ▼]

The world’s economic history has largely been a history of stagnation. The phase of sustained growth was only ignited in the second half of the 18th century by the Industrial Revolution in Britain. Since then, many countries have experienced long periods of sustained growth of per-capita income. At the same time, the world income distribution has become more and more unequal. Today per-capita incomes in the richest countries are approximately 30 times higher than in the poorest countries. The first part of this lecture takes a closer look at these past developments. In the second part, we venture a look forward. Among the questions we will address are the following: - Who needs economic growth? Does economic growth imply happiness? Is economic growth necessary to maintain our current standard of living? Does economic growth help the welfare state in the face of population aging and tight public budgets? - Can the process of sustained economic growth go on? Is “no-growth” or even “degrowth” a reasonable option? Does the concept of sustainable growth help to answer these questions? - What are the main challenges for and what are the main obstacles to growth today? [less ▲]

Population Aging and Innovation Do Old Societies Think New Ideas?

Scientific Conference (2014, July 26)

This research advances the hypothesis that at the individual level "old people think old ideas" whereas at the aggregate level "old societies think new ideas." More precisely, we empirically establish the ... [more ▼]

This research advances the hypothesis that at the individual level "old people think old ideas" whereas at the aggregate level "old societies think new ideas." More precisely, we empirically establish the following three hypotheses: i) population aging has a hump-shaped effect on innovation, ii) old societies think new ideas, and iii) the effect of population aging on innovation operates partly through a favorable attitude towards new ideas and creativity. Our results falsify the often encountered vision according to which old societies think old ideas. Moreover they emphasize that innovation activity in aging societies is in part driven by cultural attitudes. [less ▲]