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The failure of endogenous growth

Abstract

Fifteen years have passed since Paul Romer published his seminal paper that launched the field of endogenous growth. Today seems like an appropriate time to reflect back on this field and assess its contribution. My own assessment is that this line of research has not proven useful for understanding the most important question faced by economists today, namely, why isn’t the whole world rich? Exogenous growth theory, in contrast, is. Endogenous growth may prove useful for understanding growth in world knowledge over time, but it is not useful for understanding why some countries are so poor relative to the United States today.

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He received his Ph.D. from the University of Minnesota in 1990. He has taught at the University of Pennsylvania and Northeastern University. His fields of expertise are economic growth, economic development and technological change.

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Parente, S. The failure of endogenous growth. Know Techn Pol 13, 49–58 (2001). https://doi.org/10.1007/BF02693989

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  • DOI: https://doi.org/10.1007/BF02693989

Keywords

  • Capita Income
  • Total Factor Productivity
  • Endogenous Growth
  • Technology Adoption
  • Growth Theory