R&D AND ECONOMIC GROWTH IN A CASH-IN-ADVANCE ECONOMY

• 成果类型: Article
• 署名作者: Chu, Angus C.; Cozzi, Guido
• 署名单位: University of Liverpool; University of St Gallen
• 刊物名称: INTERNATIONAL ECONOMIC REVIEW
• ISSN/ISSBN: 0020-6598
• DOI: 10.1111/iere.12059
• 发表日期: 2014
• 页码: 507-524
• 关键词: endogenous growth; Friedman rule; patent length; welfare cost; money; inflation; constraints; INVESTMENT; liquidity; POLICY

摘要

R&D investment has well-known liquidity problems, with potentially important consequences. In this study, we analyze the effects of monetary policy on economic growth and social welfare in a Schumpeterian growth model with cash-in-advance (CIA) constraints on R&D investment, consumption, and manufacturing. Our main results can be summarized as follows. Under the CIA constraints on R&D and consumption (the CIA constraint on manufacturing), an increase in the nominal interest rate decreases (increases) R&D and economic growth. We also analyze the optimality of Friedman rule and find that Friedman rule can be suboptimal due to a unique feature of the Schumpeterian model.