Public policy and growth in Canada: An applied endogenous growth model with human and knowledge capital accumulation

Abstract

a b s t r a c t a r t i c l e i n f oEvidence suggests that the Canadian economy is over-shadowed with lagging productivity growth and that its innovation strategy lacks a market-oriented focus; and is unbalanced and biased. We study this problem with the aid of a dynamic general equilibrium model driven by analytics of endogenous growth and investigate the viable policy options and assess the interactions between knowledge driven growth, acquisition of human capital, and the role of strategic public policy for the Canadian economy. We study alternative public policies aimed at fostering the development of human capital (investment in education) and those at enhancing investments in innovation. Based on the re-allocation effects triggered by public subsidization policies on higher education versus industry/business R&D, our results corroborate that Canadian economy is falling short of its potential in (business) technological innovation. Our analyses further imply that the most welfare enhancing policy is to have a complementary mix of education and R&D subsidization designed to avoid the trade-offs that emerge in the short run.

An applied endogenous growth model with human and knowledge capital accumulation for the Turkish economy

“…Overall, we observe that the growth paths display a fluctuating structure toward equilibrium. Revelation of such fluctuating structures toward equilibrium is recognized also in the comparable literature by Sequeira (2011) and Voyvoda and Yeldan (2011). In general, human capital employed by R&D activities displays a more fluctuated structure than human capital employed by final good production.…”

“…As new research leading to new innovations is conducted, the index set {A} expands. Following the idea in Funke and Strulik (2000) and based on applications of Sequeira (2010Sequeira ( , 2011 and Voyvoda and Yeldan (2011), this is achieved in the R&D sector as follows: New research is generated solely by human capital allocated to the production of new ideas (research personnel), H A and excludes decreasing returns as well as the scale effects of A. 1 The research productivity of each researcher is a factor w .…”

Continuing Vocational Training in Enterprises

“…The abilities, knowledge, experiences, and skills that employees possess, and which are valuable to their employers are collectively referred to as human capital (Knudsen & Lien, 2023). According to Voyvoda & Yeldan (2015), the development of human capital is essential for fostering innovation, productivity, and long-term business growth. Employees must undergo retraining and upskilling in order to be able to use new systems and processes as a result of the shift in skill and knowledge requirements brought about by the introduction of new technologies (David, 2015).…”

Has knowledge improved economic growth? Evidence from Nigeria and South Africa

“…Mohamed (2016) assessed the impact of the KE on long‐term economic growth in the Egyptian economy for the period 1980–2014, using Granger causality to test the four components of the KE (i.e., human capital, innovation, economic growth, and institutional regime); the results indicate a causal relationship between the KE and economic growth. Voyvoda and Yeldan (2015) investigated and assessed the interactions between knowledge‐driven growth, acquisition of human capital, and role of strategy in public policy for Turkey's economy and reported that the government expenditure on education and other capital investments has a direct link with growth in Turkey. Similarly, Edvinsson and Söderberg (2011) investigated the dynamics of the knowledge economy before the industrial revolution in Sweden and Western Europe and reported the price of essential goods as an important driver of the KE.…”