Ideas and Growth
Version of Record online: 23 DEC 2008
© The London School of Economics and Political Science 2008
Volume 76, Issue 301, pages 1–19, February 2009
How to Cite
LUCAS, R. E. (2009), Ideas and Growth. Economica, 76: 1–19. doi: 10.1111/j.1468-0335.2008.00748.x
- Issue online: 23 DEC 2008
- Version of Record online: 23 DEC 2008
- Final version received 10 July 2008.
Vol. 77, Issue 307, 611, Version of Record online: 4 JUN 2010
This paper introduces and partially develops a new model of endogenous technological change, viewed as the product of a class of problem-solving producers. The model, based on earlier work by Eaton and Kortum, is built up from the premise that all knowledge resides in the head of some individual person and the knowledge of a firm, or economy, or any group of people is simply the knowledge of the individuals that comprise it. The model is applied to an economy with a cohort structure. A calibration of the model using cross-section earnings data, in addition to aggregate GDP growth, is considered.