SCHCLAREK CURUTCHET ALFREDO
Congresos y reuniones científicas
Título:
Industry Diversification, Financial Development and Productivity-Enhancing Investment
Autor/es:
ALFREDO SCHCLAREK
Lugar:
Medellín, Colombia
Reunión:
Jornada; VIII Jornadas Latinoamericanas de Teoría Económica (JOLATE); 2007
Institución organizadora:
Universidad EAFIT
Resumen:
This paper theoretically studies the role of the financial system
in promoting macroeconomic stability and growth. It also explains
endogenously the development of the financial system as a result
of industry (or sector) diversification. In the model, the
productive sector engages in R&D activities, and finances its
activities through access to the financial system. While vertical
innovation spurs economic growth, horizontal innovation creates
new industry sectors, and thus enhances industry diversification.
Higher industry diversification deepens the financial system by
improving its ability to finance the productive sector. Economies
that are more diversified, and thus more financially developed,
have higher growth rates and are less volatile. There is a role
for the government to subsidize innovation, especially horizontal
innovation.
in promoting macroeconomic stability and growth. It also explains
endogenously the development of the financial system as a result
of industry (or sector) diversification. In the model, the
productive sector engages in R&D activities, and finances its
activities through access to the financial system. While vertical
innovation spurs economic growth, horizontal innovation creates
new industry sectors, and thus enhances industry diversification.
Higher industry diversification deepens the financial system by
improving its ability to finance the productive sector. Economies
that are more diversified, and thus more financially developed,
have higher growth rates and are less volatile. There is a role
for the government to subsidize innovation, especially horizontal
innovation.
