This paper considers the prospects for constructing a neoclassical theory of growth and international trade that is consistent with some of the main features of economic development. Three models are considered and compared to evidence: a model emphasizing physical capital accumulation and technological change, a model emphasizing human capital accumulation through schooling, and a model emphasizing specialized human capital accumulation through learning-by-doing.

The mechanics of economic development

This paper presents a fully specified model of long-run growth in which knowledge is assumed to be an input in production that has increasing marginal productivity. It is essentially a competitive equilibrium model with endogenous technological change. In contrast to models based on diminishing returns, growth rates can be increasing over time, the effects of small disturbances can be amplified by the actions of private agents, and large countries may always grow faster than small countries. Long-run evidence is offered in support of the empirical relevance of these possibilities.

/pdf/increasing-returns-and-long-run-growth-1wijc940aq.pdf

Increasing Returns and Long-Run Growth

http://individual.utoronto.ca/zheli/sa1.pdf

On the mechanics of economic development

Growth in this model is driven by technological change that arises from intentional investment decisions made by profit-maximizing agents. The distinguishing feature of the technology as an input is that it is neither a conventional good nor a public good; it is a nonrival, partially excludable good. Because of the nonconvexity introduced by a nonrival good, price-taking competition cannot be supported. Instead, the equilibrium is one with monopolistic competition. The main conclusions are that the stock of human capital determines the rate of growth, that too little human capital is devoted to research in equilibrium, that integration into world markets will increase growth rates, and that having a large population is not sufficient to generate growth.

/pdf/endogenous-technological-change-4yzdlw043b.pdf

Endogenous Technological Change

Growth in this model is driven by technological change that arises from intentional investment decisions made by profit maximizing agents. The distinguishing feature of the technology as an input is that it is neither a conventional good nor a public good; it is a nonrival, partially excludable good. Because of the nonconvexity introduced by a nonrival good, price-taking competition cannot be supported, and instead, the equilibriumis one with monopolistic competition. The main conclusions are that the stock of human capital determines the rate of growth, that too little human capital is devoted to research in equilibrium, that integration into world markets will increase growth rates, and that having a large population is not sufficient to generate growth.

https://papers.ssrn.com/sol3/Delivery.cfm/nber_w3210.pdf?abstractid=226703&mirid=1

The World Economy: A Millennial Perspective

Monitoring the world economy, 1820-1992

The World Economy: Historical Statistics

Phases of Capitalist Development.

Until the eighteenth century, most of the world was caught in a Malthusian trap. Population rose about 0.04 per cent a year over the two millenia preceding 1700, and world income no faster. Since then, population has grown by 0.7 per cent a year and per capita income is a multiple of previous levels. Understandably, this transition has had a hypnotic fascination for economic historians. However, within the period of modern economic growth, there have also been distinct and important phases of development, less dramatic than the great transition, but equally worthy of study, definition and causal interpretation. These phases have characteristics which put constraints on the performance of individual countries, whether they be fast- or slow-growing. This paper deals with developments since 1870 in 16 of the more advanced capitalist countries, and divides the past century’s experience into four phases.

Angus Maddison

Papers

The World Economy: A Millennial Perspective

Monitoring the world economy, 1820-1992

The World Economy: Historical Statistics

Phases of Capitalist Development.

Phases of capitalist development