Evidence for the OECD countries show that the “great ratios”, such as the unemployment rate, factor shares, Tobin’s q and the investment-capital ratio, fluctuate significantly on medium-term frequencies of 10-40 years duration. To explain these medium-term fluctuations, we establish a...

Based on a general framework for computing the aggregate human capital stock under heterogeneity across population cohorts, the paper derives aggregate human capital stocks in the whole population and in the labor force, and relates these variables to average years of schooling and average work...

The paper investigates optimal taxation in a model where groth is the combined effect of public R&D and private human capital accumulation. A tax smoothing formula is called for. This leads to a long-run debt-income ratio related to the initial configuration of the stocks of technical knowledge,...

Can the knife-edge restriction on technology imposed by standard endogenous growth models be relaxed by allowing for nonrenewable resources entering the technology? To answer this question we examine whether stable endogenous growth is compatible with increasing returns to scale with respect to...

We propose the relaxation algorithm as a simple and powerful method for simulating the transition process in growth models. This method has a number of important advantages: (1) It can easily deal with a wide range of dynamic systems including multi-dimensional systems with stable eigenvalues...