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A Note on the Comparative Statics and Dynamics of the Romer R&D Growth Model with Quality Upgrading

Arnold, Lutz G. ; Kornprobst, Wolfgang



Zusammenfassung

This paper replaces increasing product variety with quality upgrading in the Romer model [Romer, Paul M., Journal of Political Economy 98 (1990), S71–S102]. 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 ...

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