Input-Output Deepening and Education in an Aggregative Model of Economic Growth
Keywords:
economic growth, interindustry linkages, education, industrial take-off, technological diversificationAbstract
This paper shows that a multisector model of economic growth where interindustry linkages are differentiated across sectors and technological diversification is characterized by a growing use of intermediate inputs, may be useful to analyze the process of development and industrial take-off. Education is assumed to be the driving force of technological diversification. The model yields that government subsidy to education is a necessary but not sufficient requirement for industrial take-off to occur. After aggregation, the optimal solution for the steady-state dynamic path yields that factor rewards increase with the quality of education. Local stability analysis yields that some minimum quality of education is required for long-run economic growth.Downloads
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Copyright (c) 1996 Carlos H. Ortiz
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
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