Cordoba, Juan - In: Eurasian Economic Review 3 (2013) 1, pp. 8-38
The interest rate and the rate of economic growth are often regarded as roughly constant as economies grow. Moreover … standard growth model that includes a backward and an advanced sector can account for these regularities. The mechanism works … prevents the usual diminishing marginal returns of capital. As a result, the interest rate and the growth rate of the economy …