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on Economic Growth |
| By: | Ryo Sakamoto; Katsunori Minami |
| Abstract: | Sustainable growth has emerged as a critical policy challenge worldwide. We investigate the influence of conventional gender norms on fertility and economic growth to explain the phenomena recently observed across high-income countries. To this end, we construct an overlapping generations model with endogenous fertility and labor supply, incorporating gender norms and R&D activities. We demonstrate that conventional gender norms can impede fertility and economic growth. Specifically, when gender norms are sufficiently conservative, income growth stagnates and population erosion eventually occurs. Our results underscore the need to address and correct gender norms to achieve sustainable growth and improve welfare. |
| Date: | 2024–09 |
| URL: | https://d.repec.org/n?u=RePEc:dpr:wpaper:1255r |
| By: | Riku Watanabe |
| Abstract: | This study incorporates two heterogeneous industries into an endogenous growth model within the framework of a circular economy. In the model, industries are classified as either brown or green, and each can transition between states through R&D activities related to innovation and greening. Greening R&D is conducted exclusively by firms in the brown industry and enables the transition to the green industry. We analyze the effects of subsidies for greening R&D and show that such subsidies increases labor allocation to both innovation and greening R&D. As a result, the model yields win-win outcome: economic growth is promoted not only by productivity-driven growth acceleration but also by a decline in the share of brown industries that rely on exhaustible resources, which mitigates the negative impact of resource depletion on growth. These findings suggest that advancing a circular economy can be compatible with sustained economic growth. |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:dpr:wpaper:1286r |
| By: | Katsunori Minami; Ryo Horii |
| Abstract: | This paper examines the growth effects of R&D subsidies and public-funded basic research in an R&D-based endogenous growth model when political constraints do not allow the government to increase its revenue. If individuals have enough life-cycle saving motives and R&D productivity is sufficiently high, the growth rate becomes higher than the interest rate in equilibrium, and the government can finance expenses while perpetually rolling over the debt. Given this situation, debt-financed R&D subsidies always enhance short-run growth. However, they increase long-term growth only when R&D productivity exceeds another threshold. Our estimates suggest that this condition holds for most advanced countries, including the United States, but not for low-growth countries such as Japan and Italy. In contrast, enhancing public-funded basic research is effective for economic growth even in low-growth economies. However, such policies reduce the upper bound in the debt-to-GDP ratio, beyond which the economy cannot recover to a steady state. |
| Date: | 2024–09 |
| URL: | https://d.repec.org/n?u=RePEc:dpr:wpaper:1258rr |
| By: | Katsunori Minami; Ryo Sakamoto |
| Abstract: | Gender equality plays a pivotal role in fostering human prosperity, shaping labor markets, fertility decisions, and the sustainability of social institutions. This study investigates how the prevailing gender norms in a country influence the fertility rate and long-term economic growth. To this end, we develop an overlapping generations model featuring endogenous fertility and labor supply in which both gender norms and research and development activities are explicitly incorporated. We show that conservative gender norms reduce both the fertility rate and the rate of income growth in the steady state. We further explore the impact of a policy intervention that relaxes gender norms and analyze the ensuing transition dynamics, deriving implications for policy design and welfare. Finally, we extend the model to examine how a gradual evolution in gender norms affects the long-run development of the economy. |
| Date: | 2025–06 |
| URL: | https://d.repec.org/n?u=RePEc:dpr:wpaper:1291r |
| By: | Julius Koschnick |
| Abstract: | What was the origin of modern economic growth? Joel Mokyr has argued that self-sustained modern economic growth originated from a feedback loop between propositional (theoretical) and prescriptive (applied) knowledge, which turned positive in the eighteenth century during the "Industrial Enlightenment". While influential, this thesis has never been directly tested. This paper provides the first quantitative evidence by estimating the impact of knowledge spillovers between propositional and prescriptive knowledge on innovation in England, 1600-1800. For this, it introduces two new text-based measures for 1) the innovativeness of publications and 2) knowledge spillovers. The paper finds strong evidence that a feedback loop between propositional and prescriptive knowledge became positive during the second half of the eighteenth century. It also documents that this process had positive effects on the real economy as measured through patents. Overall, the findings provide empirical support for Mokyr's original hypothesis. |
| Date: | 2025–12 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2512.16587 |
| By: | Raouf Boucekkine (Aix-Marseille Univ., CNRS, AMSE, Marseille, France); Carmen Camacho (Paris School of Economics and CNRS, France.); Weihua Ruan (Department of mathematics, Purdue University Northwest, USA) |
| Abstract: | The dynamics of capital distribution across space are an important topic in economic geography and, more recently, in growth theory. In particular, the spatial AK model has been intensively studied in the latter stream. It turns out that the positivity of optimal capital stocks over time and space for any initial capital spatial distribution has not been entirely settled even in the simple linear AK case. We use Ekeland’s variational principle together with Pontryagin’s maximum principle to solve an optimal spatiotemporal AK model with a state constraint (non-negative capital stock), where the capital law of motion follows a diffusion equation. We derive the necessary optimality conditions to ensure the solution satisfies the state constraints for all times and locations. The maximum principle enables the reduction of the infinite-horizon optimal control problem to a finite-horizon problem, ultimately proving the uniqueness of the optimal solution with positive capital and the non-existence of such a solution when the time discount rate is either too large or too small. |
| Keywords: | Diffusion and growth, Convergence, optimal control, State constraint, Ekeland’s variational principle |
| JEL: | C61 O44 Q15 Q56 R11 |
| Date: | 2025–12 |
| URL: | https://d.repec.org/n?u=RePEc:aim:wpaimx:2533 |
| By: | Alberto Botta |
| Abstract: | In this paper, we present a Balance-of-Payments (BoP)-constrained center-periphery growth model extended for the inclusion of international finance and the accumulation of external debt. With respect to previous works in this stream of literature, we show how the long-run BoP-constrained growth rate changes endogenously alongside the evolution of periphery’s external position. We describe a complex non-linear system that may feature multiple equilibria with different stability properties. A stable equilibrium characterized by high long-run BoP-constrained growth and low external indebtedness is paired with a saddle-path unstable one in which a more fragile external position associates with lower growth. We also show that periods of (temporary) financial “bonanza”, i.e., surges in foreign capital pouring into the economy, may modify the long-run growth trajectory of the periphery and its overall macro stability. Financial bonanza can boost economic growth in the short term. However, it can also give rise to tougher debt service payments and possibly lead to cases of premature de-industrialization. Despite short-term benefits, the periphery may well get worse off in the long run. If the financial boom is strong and protracted enough, it can even generate radical instability driving the periphery towards default on external debt. In the final part of the paper, we discuss the policy implications of the model, namely the role of capital controls as part of a broader development strategy aimed at taming finance-led instability and boosting structural change in the periphery. |
| Keywords: | External constraint; international capital; financial bonanza; premature de-industrialization |
| JEL: | E12 F43 F62 O11 |
| Date: | 2026–01 |
| URL: | https://d.repec.org/n?u=RePEc:pke:wpaper:pkwp2601 |
| By: | Ufuk Akcigit; Harun Alp; Jeremy Pearce; Marta Prato |
| Abstract: | Why do some entrepreneurs drive economic growth while others do not? This piece discusses new work that studies entrepreneurs using a comprehensive dataset from Denmark. We study who becomes an entrepreneur, along with their hiring and business decisions, and find that a distinct minority are “transformative.” These individuals, who generate disproportionate productivity gains, tend to have high IQ scores, be well-educated, and hire technical (R&D) workers. The data support the idea of productivity growth being driven by the symbiotic relationship between transformative entrepreneurs and R&D workers. For policymakers, the lesson is that when an economy has more R&D workers and transformative entrepreneurs, they sustain higher long-run productivity growth. |
| Keywords: | entrepreneurship; R&D; innovation; productivity growth |
| JEL: | O31 O38 |
| Date: | 2026–01–05 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fednls:102298 |
| By: | Georgios A. Tritsaris |
| Abstract: | The Fourth Industrial Revolution commonly refers to the accelerating technological transformation that has been taking place in the 21st century. Economic growth theories which treat the accumulation of knowledge and its effect on production endogenously remain relevant, yet they have been evolving to explain how the current wave of advancements in automation and artificial intelligence (AI) technology will affect productivity and different occupations. The work contributes to current economic discourse by developing an analytical task-based framework that endogenously integrates knowledge accumulation with frictions that describe technological lock-in and the burden of knowledge generation and validation. The interaction between production (or automation) and growth (or knowledge accumulation) is also described explicitly. To study how automation and AI shape economic outcomes, I rely on high-throughput calculations of the developed model. The effect of the model's structural parameters on key variables such as the production output, wages, and labor shares of output is quantified, and possible intervention strategies are briefly discussed. An important result is that wages and labor shares are not directly linked, instead they can be influenced independently through distinct policy levers. |
| Date: | 2025–12 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2512.16261 |
| By: | Victor Gay (IAST - Institute for Advanced Study in Toulouse, TSE-R - Toulouse School of Economics - UT Capitole - Université Toulouse Capitole - Comue de Toulouse - Communauté d'universités et établissements de Toulouse - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Paula Gobbi (ULB - Université libre de Bruxelles, CEPR - Center for Economic Policy Research); Marc Goñi (UiB - University of Bergen, CEPR - Center for Economic Policy Research) |
| Abstract: | We test Le Play's (1875) hypothesis that the French Revolution contributed to France's early fertility decline by imposing equal partition of inheritance among all children, including women. We combine new data on local inheritance rules before the Revolution and individual-level demographic data from historical sources and crowdsourced genealogies. Difference-in-differences and regression-discontinuity estimates show that the inheritance reforms enacted during the Revolution reduced completed fertility by 0.5 children. A key mechanism was the desire to avoid land fragmentation across generations. These reforms closed the fertility gap between regions with different historical inheritance rules and crucially contributed to France's demographic transition. |
| Keywords: | Inheritance, French Revolution, Fertility, Demographic transition |
| Date: | 2025–10–24 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-04285818 |
| By: | Ali Zeytoon-Nejad |
| Abstract: | Business growth is a goal of great importance for its both private and social benefits. Many firms view business growth as an imperative for their survival, stability, and long-term success. Business growth can be socially beneficial, too, as it enables businesses to expand into new territories where they can stimulate economic growth and development, creates more jobs, increase living standards, and better serve their communities by giving back more through Corporate Social Responsibility initiatives. Business growth must be planned reasonably and optimally so that it can effectively achieve its critical ambitions in business practice. The current common practices for planning the supply side of business growth are usually ad-hoc and lack well-established mathematical and economic foundations. The present paper argues that business growth planning can be pursued more structurally, reliably, and meaningfully within the framework of Growth Accounting (GA), which was first introduced by Economics Nobel Laureate Robert Solow to study economic growth. It is shown that, although GA was initially put forth as a procedure to explain "economic growth" ex-post, it can similarly be used to plan "business growth" ex-ante when a general backward approach is taken in its procedure-called Backward Growth Accounting (BGA) in this paper. Taking this well-established economic-mathematical approach to planning business growth will enhance the current practices conceptually and structurally, as it is built on the basis of economic logic and mathematical tools. BGA can help businesses identify and plan for key drivers of output growth and assess shortcomings in the growth process, such as poor productivity, inadequate labor utilization, or insufficient capital investment. The paper outlines an eight-step procedure for planning business growth using BGA and includes appendices with real-world examples. |
| Date: | 2025–12 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2512.19029 |
| By: | Oded Galor; Daniel C. Wainstock |
| Abstract: | Is income inequality in the United States primarily driven by disparities between ethnic groups or within them? The evidence reveals a striking pattern: 96% of U.S. income inequality arises from variation within groups sharing common ancestral origins, far overshadowing the comparatively small share attributable to differences between these groups. This pattern remains remarkably stable across time and regions. |
| JEL: | D63 J15 O15 Z13 |
| Date: | 2025–12 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:34558 |