The intellectual breakthrough contributed by the new growth theory was the recognition that investments in knowledge … and human capital endogenously generate economic growth through the spillover of knowledge. Endogenous growth theory does … not explain how or why spillovers occur. The missing link is the mechanism converting knowledge into economically relevant …

This paper explores the relationship between knowledge creation, entrepreneurship, and economic growth in the United … States over the last 150 years. According to the “new growth theory,” investments in knowledge and human capital generate … economic growth via spillovers of knowledge. But the theory does not explain how or why spillovers occur, or why large …