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Network structure and economic growth

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  • Huang, Jingong

Abstract

This paper develops a multisector endogenous growth model which embeds a technology network that captures heterogeneous intersectoral knowledge spillovers. We show that the growth rate of knowledge is equal to the dominant eigenvalue of the technology network. The structure of the technology network is crucial in determining the effect of knowledge spillover. Specifically, the sparsity of the technology network imposes an upper bound on the impact of knowledge spillovers, which then determines the growth rate at both the sectoral and aggregate level.

Suggested Citation

  • Huang, Jingong, 2021. "Network structure and economic growth," Economics Letters, Elsevier, vol. 207(C).
    • Handle: RePEc:eee:ecolet:v:207:y:2021:i:c:s0165176521002998
    DOI: 10.1016/j.econlet.2021.110022
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    References listed on IDEAS

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    1. Romer, Paul M, 1986. "Increasing Returns and Long-run Growth," Journal of Political Economy, University of Chicago Press, vol. 94(5), pages 1002-1037, October.
    2. Daron Acemoglu & Pablo D. Azar, 2020. "Endogenous Production Networks," Econometrica, Econometric Society, vol. 88(1), pages 33-82, January.
    3. Aghion, Philippe & Howitt, Peter, 1992. "A Model of Growth through Creative Destruction," Econometrica, Econometric Society, vol. 60(2), pages 323-351, March.
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    5. Tor Jakob Klette & Samuel Kortum, 2004. "Innovating Firms and Aggregate Innovation," Journal of Political Economy, University of Chicago Press, vol. 112(5), pages 986-1018, October.
    6. Samuel S. Kortum, 1997. "Research, Patenting, and Technological Change," Econometrica, Econometric Society, vol. 65(6), pages 1389-1420, November.
    7. Matthew O. Jackson & Brian W. Rogers, 2007. "Meeting Strangers and Friends of Friends: How Random Are Social Networks?," American Economic Review, American Economic Association, vol. 97(3), pages 890-915, June.
    8. Aghion, Philippe & Harris, Christopher & Vickers, John, 1997. "Competition and growth with step-by-step innovation: An example," European Economic Review, Elsevier, vol. 41(3-5), pages 771-782, April.
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    Cited by:

    1. Suwan Lu & Guobin Fang & Mingtao Zhao, 2023. "Towards Inclusive Growth: Perspective of Regional Spatial Correlation Network in China," Sustainability, MDPI, vol. 15(7), pages 1-19, March.
    2. Hötte, Kerstin, 2023. "Demand-pull, technology-push, and the direction of technological change," Research Policy, Elsevier, vol. 52(5).
    3. Xin Dai & Jie Tang & Qin Huang & Wenyue Cui, 2023. "Knowledge Spillover and Spatial Innovation Growth: Evidence from China’s Yangtze River Delta," Sustainability, MDPI, vol. 15(19), pages 1-26, September.

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    More about this item

    Keywords

    Technology network; Firm innovation; Knowledge spillovers; Growth;
    All these keywords.

    JEL classification:

    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

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