This part of the book focuses on models of endogenous technological change.

Chapter 12 discusses various different approaches to technological change and provides a brief overview of some models of technological progress from the industrial organization literature.

Chapters 13 and 14 present the baseline endogenous technological progress models developed by Romer, Grossman and Helpman and Aghion and Howitt. Chapter 15 considers a richer class of models in which the direction of technological change, for example, which factors technological change will augment or complement, is also endogenous. The models presented in this part of the book are useful for two related purposes. First, they enable us to endogenize technology, thus allowing a more in-depth study of cross-country and over-time differences in technologies. This is useful since, as discussed in Chapter 3, differences in technology and in the efficiency with which factors of production are used are a major proximate cause of growth over time and of cross-country differences in economic performance. Second, endogenous technology models provide a tractable approach to modeling sustained growth, which will be later combined with other factors to investigate the determinants of country and world growth rates.

More on the topic This part of the book focuses on models of endogenous technological change.:

1. Conclusion
2. References
3. Concluding remarks
4. Acknowledgements