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credit and innovation markets. The interplay between these two frictions generates a nonlinear relationship between finance … and growth. Financial development eases the financing of innovation but can exacerbate bottlenecks in R&D. In a …
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Recent work on money and endogenous growth finds modest welfare costs of inflation. Furthermore, high inflation reduces the growth rate. The author presents a monetary endogenous growth model with labor market frictions in the form of search unemployment which is calibrated for the US economy....
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