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Publication Detailed Description
Social infrastructure and the preservation of physical capital: equilibria and transitional dynamics
Journal Title
Applied Mathematics and Computation
Year (definitive publication)
2018
Language
English
Country
Netherlands
More Information
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Abstract
We study the mechanisms according to which social infrastructure influences the preservation of physical capital and, consequently, economic growth. The model considers that social infrastructure is a specific type of human capital, which acts in order to preserve already existing physical capital, by, e.g., reducing the incentive for rent seeking or corruption. Using an innovative methodology in economics, the Gröbner bases, we study the equilibrium of our model and conclude for the existence of two feasible steady-states or of unicity according to different combinations of parameters, highlighting a trade-off between consumption and production on one hand and social infrastructure and physical capital accumulation, on the other. We also present sufficient conditions for saddle-path stability. Finally, we describe transitional dynamics and calculate welfare effects from which we show that strengthening social infrastructure increases welfare.
Acknowledgements
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Keywords
Social infrastructure,Physical capital depreciation,Endogenous growth,Multiple equilibria,Gröbner bases
Fields of Science and Technology Classification
- Mathematics - Natural Sciences
- Economics and Business - Social Sciences
Funding Records
| Funding Reference | Funding Entity |
|---|---|
| PTDC/EGE-ECO/102238/2008 | Fundação para a Ciência e a Tecnologia |
| PEst-OE/EGE/UI0315/2011 | Fundação para a Ciência e a Tecnologia |
| PTDC/MAT/099275/2008 | Fundação para a Ciência e a Tecnologia |
| UID/ECO/04007/2013 | Fundação para a Ciência e a Tecnologia |
Related Projects
This publication is an output of the following project(s):
Contributions to the Sustainable Development Goals of the United Nations
With the objective to increase the research activity directed towards the achievement of the United Nations 2030 Sustainable Development Goals, the possibility of associating scientific publications with the Sustainable Development Goals is now available in Ciência-IUL. These are the Sustainable Development Goals identified by the author(s) for this publication. For more detailed information on the Sustainable Development Goals, click here.
