Construction of nonlinear stabilizer for trajectories of economic growth

A dynamic model of optimization of R&D intensity is studied for analyzing the effect of the spillover technology assimilation on techno-economic growth. The research focuses on the issue of a reasonable balance in the R&D investment policy between the indigenous technology stock and exogenou...

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Bibliographic Details
Published in:Journal of optimization theory and applications 2007-08, Vol.134 (2), p.303-320
Main Authors: ANE, B. K, TARASYEV, A. M, WATANABE, C
Format: Article
Language:English
Subjects:
Applied sciences
Boundary conditions
Construction
Construction costs
Econometrics
Economic growth
Economics
Exact sciences and technology
Financing
General aspects
Impact analysis
Investment
Investment policy
Investments
Mathematical models
Mathematical programming
Nonlinearity
Operational research and scientific management
Operational research. Management science
Optimization
Optimization techniques
Productivity
R&D
Research & development
Studies
Sustaining
Technology stocks
Trends
Utility functions
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Summary:A dynamic model of optimization of R&D intensity is studied for analyzing the effect of the spillover technology assimilation on techno-economic growth. The research focuses on the issue of a reasonable balance in the R&D investment policy between the indigenous technology stock and exogenous technology flow. On the basis of the concavity properties of the Hamiltonian, a nonlinear stabilizer sustaining proportional techno-economic growth is constructed. Trends of optimal R&D intensity are examined depending on the values of the model macroeconomic parameters and the feedback variables. Econometric analysis shows that additional investments and restructuring of these sources for knowledge absorption could have the effect of increasing returns and provide a strong leverage for reaching qualitatively higher levels of sales, technology development, and consumption index.
ISSN:0022-3239
1573-2878
DOI:10.1007/s10957-007-9256-3