Speaker: Prof Ryo Horii
Affiliation: The University of Osaka
Location: Room 214, Chamberlain Building (#35), St Lucia Campus
Zoom: https://uqz.zoom.us/j/82603079317
Abstract: Should R&D subsidies be targeted towards certain types of technologies? We build and calibrate a directed technical change growth model with both capital- and labor-augmenting technological change along the balanced growth path, circumventing the restrictions usually posed by the Uzawa steady-state theorem. We use the model to study how directed R&D policy affects the rate of economic growth and the labor share of income. For a given level of expenditure, capital-augmenting R&D subsidies provide the largest boost to economic growth, labor-augmenting technology subsidies provide the smallest boost, and uniform subsidies to all technologies are an intermediate case. Capital-augmenting R&D subsidies increase the labor share, while labor-augmenting R\&D subsidies decrease the labor share. Uniform R&D subsidies are non-neutral and slightly increase the labor share. Taxes on factor inputs do not affect the long-run rate or direction of technical change, nor do they impact the pre-tax labor share of income.
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A seminar series designed specifically for macroeconomists to connect and collaborate.
