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Endogenous Innovation in the Theory of Growth

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Author Info
Gene M. Grossman
Elhanan Helpman

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Abstract

This paper makes the case that purposive, profit-seeking investments in knowledge play a critical role in the long-run growth process. First, we review the implications of neoclassical growth theory and the more recent theories of 'endogenous growth'. Then we discuss the empirical evidence that bears on the modeling of long-run growth. Finally, we describe in more detail a model of growth based on endogenous technological progress and discuss the lessons that such models can teach us.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 4527.

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Date of creation: Nov 1993
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Publication status: published as Journal of Economic Perspectives, Vol. 8, pp. 23-44.
Handle: RePEc:nbr:nberwo:4527

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