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Kant’s Endogenous Growth Mechanism

Author

Listed:
  • Gabriel Fagan

    (European Central Bank)

  • Vito Gaspar

    (International Monetary Fund)

  • Peter McAdam

    (European Central Bank and University of Surrey)

Abstract

Despite the modern origins of endogenous growth theory, we argue that the ‘Idea for a Universal History with a Cosmopolitan Aim’ written by Immanuel Kant in 1784 provides an early and coherent example of such a theory. Kant’s endogenous growth mechanism is driven by the inherent rivalry that exists between agents which increases effort and strengthens the accumulation of knowledge, which in turn is carried through generations. In an exercise in rational reconstruction, we present a mathematical model of Kant’s mechanism. We use the model to contribute to the contemporary policy debate as to whether “keeping up with the Joneses” leads to excessive effort.

Suggested Citation

  • Gabriel Fagan & Vito Gaspar & Peter McAdam, 2014. "Kant’s Endogenous Growth Mechanism," School of Economics Discussion Papers 0214, School of Economics, University of Surrey.
    • Handle: RePEc:sur:surrec:0214
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • A12 - General Economics and Teaching - - General Economics - - - Relation of Economics to Other Disciplines
    • B3 - Schools of Economic Thought and Methodology - - History of Economic Thought: Individuals
    • N0 - Economic History - - General
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • P1 - Political Economy and Comparative Economic Systems - - Capitalist Economies

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