Capital Growth Paths of the Neoclassical Growth Model |
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| Authors: | Taro Takahashi |
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| Institution: | Graduate School of Agricultural and Life Sciences, The University of Tokyo, Bunkyo, Tokyo, Japan.; Philipps-University Marburg, Germany, |
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| Abstract: | This paper derives the first-order approximated paths of both types of capital in the two-capital neoclassical growth model. The derived capital growth paths reveal that the short-run growth effect of capital injection differs considerably depending on which type of capital is enhanced. This result demonstrates the importance of well-targeted capital enhancement programs such as public sector projects and foreign aid. |
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