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A Linear Multisector Model of “Endogenous” Growth and the Problem of Capital
Author(s) -
Salvadori Neri
Publication year - 1998
Publication title -
metroeconomica
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.256
H-Index - 29
eISSN - 1467-999X
pISSN - 0026-1386
DOI - 10.1111/1467-999x.00055
Subject(s) - economics , endogenous growth theory , capital (architecture) , position (finance) , capital good , growth model , neoclassical economics , mathematical economics , econometrics , macroeconomics , human capital , market economy , finance , public good , archaeology , history
In this paper a linear multisector model of “endogenous” growth with heterogeneous capital goods is elaborated. The purpose of this exercise is to show that this kind of model is exempt from the capital theory critique put forward against the conventional long‐period neoclassical growth model á la Solow. This confirms previous claims that at least some of the “new” growth models are somewhat extraneous to neoclassical analysis and actually exhibit the logical structure of classical theory. In addition it is shown that the use of an intertemporal analysis to establish a correct long‐period position is not necessary and that the use of the long‐period method may speed up the elaboration of new scientific results.