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- Title
IS GARRISON'S NOTION OF "SECULAR GROWTH" COMPATIBLE WITH THE SOLOW GROWTH LITERATURE?
- Authors
MURPHY, ROBERT P.
- Abstract
Roger Garrison (2001) employs the concept of "secular growth" in which a one-shot (but permanent) fall in time preferences can yield a long string of doses of net investment, so long as gross saving exceeds depreciation. However, Salerno (2001) argues that secular growth is incompatible with orthodox Austrian capital theory, and suggests ways that Garrison's appeal to neoclassical readers can be maintained while respecting the framework bequeathed by Rothbard. Commenting on the dispute, Young (2009) argues--perhaps ironically--that the mainstream growth literature, steeped in the famous Solow model, comes down on the side of Salerno. The present paper clarifies some ambiguities in Young's discussion, and then argues that Garrison's usage of "secular growth" is more likely to resonate with a neoclassical reader than Salerno's approach. To be sure, Rothbardians may ultimately reject Garrison's standard exposition (because of Salerno's objections), but Time and Money still represents a smooth gateway to introduce neoclassical readers to capital-based macroeconomics
- Subjects
SOLOW growth model; ECONOMIC development; CAPITAL; GARRISON, Roger; INVESTMENTS; MACROECONOMICS
- Publication
Quarterly Journal of Austrian Economics, 2017, Vol 20, Issue 4, p336
- ISSN
1098-3708
- Publication type
Article