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- Title
Endogenous technological change: a note on stability.
- Authors
Arnold, Lutz G.
- Abstract
Summary. This paper demonstrates that the steady-state solution of the optimal growth problem in Romer's (1990) model of endogenous technological change is globally saddle-point stable. Surprisingly, the proof of this result is trivial. Interest in the optimal growth path is justified by the fact that there is a (unique) combination of production and R&D subsidies by means of which the optimal growth path is attained as a market equilibrium.
- Subjects
TECHNOLOGICAL innovations; PRODUCTION (Economic theory); ECONOMIC equilibrium; METHOD of steepest descent (Numerical analysis); ENDOGENOUS growth (Economics)
- Publication
Economic Theory, 2000, Vol 16, Issue 1, p219
- ISSN
0938-2259
- Publication type
Article
- DOI
10.1007/s001990050335