IDEAS home Printed from https://ideas.repec.org/p/hhs/sunrpe/2001_0004.html
   My bibliography  Save this paper

Solovia Revisited - An Extension of the Solowian Growth Model

Author

Listed:

Abstract

In this study an Extended Version of the Solowian growth model is presented and its properties are compared with those of the original model. In the Solowian model the forces behind the growth process are exogenous and disembodied. In the Extended Model technological change is divided into two parts. One disembodied component related to the input of labor, measured in efficiency units, and one embodied component related to technical change. The disembodied labor component is endogenously determined by the real wage rate, while the embodied technical component is exogenous. The principal result of the study is that in the short and medium term a change in the savings ratio has a larger effect on the rate of growth in the Extended Model than in the original Solowian model. Also, while the equilibrium growth rate of production and that of the capital stock are the same in the original model, this is not the case in the Extended Model. In the Extended Model the equilibrium growth rate of production is smaller than that of the capital stock, measured in efficiency units.

Suggested Citation

  • Restad, Tomas, 2001. "Solovia Revisited - An Extension of the Solowian Growth Model," Research Papers in Economics 2001:4, Stockholm University, Department of Economics.
    • Handle: RePEc:hhs:sunrpe:2001_0004
    as

    Download full text from publisher

    File URL: http://www2.ne.su.se/paper/wp01_04.pdf
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    Economic growth; Economic theory;

    JEL classification:

    • E13 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Neoclassical
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:hhs:sunrpe:2001_0004. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Anne Jensen (email available below). General contact details of provider: https://edirc.repec.org/data/neisuse.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.