The Dynamics of the Romer R&D Growth Model with Quality Upgrading

URN to cite this document:: urn:nbn:de:bvb:355-opus-6730
DOI to cite this document:: 10.5283/epub.4529

Arnold, Lutz G. ; Kornprobst, Wolfgang

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Date of publication of this fulltext: 29 Jun 2006 13:47

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Abstract

This paper replaces increasing product variety with quality upgrading in the Romer (1990) model. We show that the range of parameters for which a steady state exists can be divided into two subspaces with well-behaved comparative statics and saddle-point dynamics in one subspace, but with "perverse" comparative-statics properties and either equilibrium indeterminacy or instability in the other ...