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Can Growth Theory Contribute to Our Understanding of Nineteenth Century Economic Dynamics? Research Memorandum 573 (GD- 12) Ronald Albers, Adrian Clemens and Peter Groote October 1994 Can Growth Theory Contribute to Our Understanding of Nineteenth Century Economic Dynamics? Research Memorandum 573 (GD-12) Ronald Albers, Adrian Clemens and Peter Groote October 1994
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Editors: Prof.& J.L. Bouma Prof.& W.K. Klein Haneveld Prof.& S.K. Kuipers Prof.& P.S.H. Leeflang Prof.dr A. Maddison Prof.& J. Pen Prof.dr H-J. Wagener Prof.dr T.J. Wansbeek Memorandum from Institute of Economic Research' Faculty of Economics University of Groningen P.O. Box 800 9700 AV Groningen - The Netherlands tel. 3 1-50-63374 1 fax. 3 1-50-637337 Research memoranda of the Groningen Growth and Development Centre are published as a sub-series of the memorandum series of the Institute of Economic Research. Editors: Memorandum from Prof.dr I.L. Bouma Institute of Economic Research‘ Prof.dr W.K. Klein Haneveld Faculty of Economics Prof.dr S.K. Kuipers University of Groningen Prof.dr P.S.H. Leeflang P.O. Box 800 Prof.dr A. Maddison 9700 AV Groningen - The Netherlands Prof.dr J. Pen tel. 31-50-633741 Prof.dr H-J. Wagener fax. 31-50-637337 Prof.dr TJ. Wansbeek ' Research memoranda of the Groningen Growth and Development Centre are published as a sub-series of the memorandum series of the Institute of Economic Research.
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Can growth theory contribute to our understanding of nineteenth century economic dynamics? The role of capital in economic growth in The Netherlands, 1850-1 91 3. by Ronald Albers, Adrian Clemens, Peter Groote (University of Groningen) Capital has always held a prominent, but controversial, position in the academic discussion on economic growth. Ever since Robert Solow's model of growth (Solow 1956) has become the standard in neo-classical thought, it has been considered frustrating that the model is characterized by constant returns to scale ([email protected]= 1). Conceptually it has prwed unsatis- factory that in the Solow-model continuous growth per head is only possible via some Standard neo-classical growth model Y = [email protected] Y gross domestic product K stock of capital (reproducible inputs) L labour (non-reproducible inputs or inputs in fixed supply) A constant, reflecting the technological starting position of society # exogenous rate at which technology evolves a output elasticity of capital; O<a< 1: decreasing marginal returns to capital B output elasticity of labour; O<B< 1 : decreasing marginal returns to labour 0 + B =1 Note: a list of symbols may be found at the end of this paper * An earlier version of this paper was presented at a Ph.D.-clinic and an Economic Hiry colloquium at the University of Groningen, and at the European Summer School 'New Gravth Theory and ita Historical Implications', which WM held in Florence, 7-12 July 1994.
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  • Summer '14
  • The Land, ........., the Netherlands

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