Public education, technological change and economic prosperity: semi-endogenous growth revisited

We introduce publicly funded education into R&D based economic growth theory. Our framework allows us to i) explicitly describe a realistic process of human capital accumulation within these types of growth models, ii) reconcile semi-endogenous growth theory with the empirical evidence on the relationship between economic development and population growth, iii) revise the policy invariance result of semiendogenous growth frameworks. In particular, we show that the model supports a negative (positive) association between economic growth and population growth if the education sector is well (badly) developed and that changes of public investments into education crucially aect the long-run balanced growth path.