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Understanding Economic Growth
3
Preface
7
Contents
9
Chapter 1: Development
11
1.1 Economic Growth
14
1.2 Knowledge Capital
16
1.3 Concluding Remarks
17
Chapter 2: The Market
18
2.1 The Classical Approach
18
2.2 The Neoclassical View
19
2.3 The Modern Approach
20
2.4 The Institutional Approach
21
2.5 The Evolutionary View
23
2.6 Market Expansion and Growth
25
Chapter 3: Investment
27
3.1 Solow’s Growth Model
28
3.2 Endogenous Growth
29
3.3 Foreign Direct Investment
32
3.4 Investment and Increasing Returns
33
Chapter 4: Innovation
37
4.1 Growth Miracles
38
4.2 Innovation Models
39
4.3 Innovation Diversity
43
4.4 Innovation Policy
46
Chapter 5: Diffusion
48
5.1 Technology Transfer
48
5.2 Learning by Doing
50
5.3 Diffusion Models
52
5.4 Incremental Diffusion
54
5.5 Concluding Remarks
57
Chapter 6: Asian Miracles
58
6.1 China’s Experience
59
6.2 India and China
65
6.3 Taiwan and Korea
68
6.4 Learning by Doing and Efficiency Growth
73
Chapter 7: Evolutionary Economics
75
7.1 Dynamic Capability and Adaptive Efficiency
76
7.2 Schumpeterian Innovation Model
78
7.3 Models of Industry Growth
80
7.4 Evolutionary Economics
81
7.5 Innovation Efficiency
84
Chapter 8: Growth
86
8.1 Information Technology
86
8.2 Productivity
87
8.3 Inequality
89
8.4 Market Failure
91
8.5 Transparency in Information Markets
93
8.6 Market Power and Dominant Firms
94
8.7 Concluding Remarks
96
Chapter 9: Growth Policy
97
9.1 Costs of Growth
98
9.2 Energy Policy
99
9.3 Learning by Doing
102
9.4 Cost of Institutional Reforms
109
9.5 Cost of Debt Crisis
115
9.6 Challenge of Globalization
116
References
118
Index
121
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