The purpose of this paper is to study the mechanism that allows a new industry to become the leading industry, using a variety expanding model based on Grossman-Helpman (1991). For this, we introduce two types of industries, mature and new industries, which are characterized by the differences...

This paper introduces external habit formation into one of the basic models of endogenous growth in which continuing expansion of product variety sustains long-term growth. We assume that households consume a range of final goods and they set a benchmark level of consumption for each good. The...

This paper introduces consumption externalities into one of the base line models of growth in which continuing expansion of product variety sustains long-term growth. We assume that consumers set a benchmark stock of consumption for each good so that there are commodity-specific external...

This paper studies a two-sector model of endogenous technical change in which expansion of each production sector is associated with sector-specific R&D investment. It is shown that the pattern of growth is sensitive to the specification of intersectoral technological spillover as well as to the...