An extension to the neoclassical growth modelto Estimate Growth and Level Effects

Rao, B. Bhaskara and Singh, Rup and Nisha, Fozia (2006): An extension to the neoclassical growth modelto Estimate Growth and Level Effects.

Abstract

The neoclassical growth model was extended by Mankiw, Romer and Weil (1992) to estimate the level effects of additional factors like human capital. We suggest a further extension to capture their permanent growth effects. Time series data from Fiji are used to show that the growth effect of human capital, although small, is significant. Furthermore, in our sample the specifications with a permanent growth effect performed better than specifications with only level effects.

• Item Type: MPRA Paper
• Language: English
• Keywords: The Solow Growth Model; Production Function; Shift Variables; Human Capital Level and Growth Effects
• Subjects: O - Economic Development, Innovation, Technological Change, and Growth > O5 - Economywide Country Studies > O56 - Oceania; O - Economic Development, Innovation, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O40 - General; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development; I - Health, Education, and Welfare > I2 - Education and Research Institutions > I29 - Other; O - Economic Development, Innovation, Technological Change, and Growth > O3 - Innovation ; Research and Development ; Technological Change ; Intellectual Property Rights > O30 - General; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O11 - Macroeconomic Analyses of Economic Development; I - Health, Education, and Welfare > I2 - Education and Research Institutions > I20 - General