TITLE:
Standing-on-Shoulder and Fishing-Out Synergies: A Model for Endogenous Long-Waves
AUTHORS:
Grigoris Zarotiadis, Eirini Ozouni
KEYWORDS:
Long Waves, Standing on Shoulders, Fishing out, Technological Change
JOURNAL NAME:
Theoretical Economics Letters,
Vol.7 No.7,
December
15,
2017
ABSTRACT: Standard growth theory considers a constant,
endogenously defined rate of technological change that generates a log-linear
evolution of economic activity. Yet, the persistent current phase of worldwide
slowdown triggers the awakening of “long waves” theories. In the present paper,
starting from a dynamically evolving synergy of Romer’s “fishing out” and
“standing on shoulders” effects, we end up having three mechanisms that provoke
a cyclical evolution of applied ideas: a direct impact through applied
research’s productivity; an effect through researcher’s effort allocation; and
an effect through the allocation of labour force. Putting these together, we
initiate long waves of per capita (p.c.) output.