In a simple discrete-time version of Lucas (1988) we find that the Balanced Growth Path (BGP) is always unique optimal planner’s solution: with linear or strictly concave production functions, unbounded utility without human capital depreciation. When ”speed” accumulation high, working time constant and below its upper bound. Capital grows at factor, but degrowth also possible when this factor ...

Measuring the private returns to R&D requires knowledge of its private depreciation or obsolescence rate, which is inherently variable and responds to competitive pressure. Nevertheless, most of the previous literature has used a constant depreciation rate to construct R&D capital stocks and measure the returns to R&D, a rate usually equal to 15 per cent. In this paper I review the implications...

In this paper, we propose a theoretical framework to investigate the impact of conflicts and wars on key macroeconomic aggregates and welfare. Using a panel data with 12 countries from 1875 onwards we first show that consumption drops more than output during conflicts, while the opposite is true during “peaceful” recessions. To handle both cases, we build a variation of a Real Business Cycle mo...

Heterogeneity in the Production of Human Capital We derive a tractable nonlinear earnings function which we estimate separately for each individual in the NLSY79 data. These estimates yield five important parameters for each individual: three ability measures (two representing the ability to learn and one the ability to earn), a rate of skill depreciation, and a time discount rate. In addition,...

The current international integration of financial markets provides a channel for currency depreciation to affect stock prices. Moreover, the recent financial crisis in Asia with its accompanying exchange rate volatility affords a case study to examine that channel. This paper applies a bivariate GARCH-M model of the reduced form of stock market returns to investigate empirically the effects of...

The paper considers the category of “economic potential”, reveals approaches researchers to understanding economic potential. Investment potential is one components presented indicators (factors) reflecting investment do not reflect sources in fixed assets. In this regard, author proposes introduce concept “depreciation potential”. content depreciation clarified. need for importance use charges...

in recent years, iran has experienced high level depreciation of the nominal exchange rate (ner). the ultimate effects of such depreciation on iranian families’ welfare and income distribution have been a challenging issue among policymakers and researchers. accordingly, this study evaluates the economic effects of ner depreciation on the rice market, using spatial price equilibrium model. the ...