economics terms

Endogenous Technical Change

In the Solow growth model technical progresss is exogenous.  It happens for reasons not explained by the model.  The endogenous technical change innovation attributes technical progress to systematic efforts by economic agents.  The new model explains, for example, how agents might set out to spend resources improving on technology instead of simply increasing the quantity of the capital stock.

The original (mathematical) account:
Selected Articles on Economic Growth by Paul Romer

The accessible account:
Knowledge and the Wealth Of Nations: A Story of Economic Discovery

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Economics Terms

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Endogenous Technical Change
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