Endogenous Growth Models (R&D)
- Two-sector economy: 1 produces ideas and 2 produces output
- Sector 1 employs the share \(a_L\) of labor stock and 2 employs the remaining
- Sector 1 employs the share \(a_K\) of capital stock and 2 employs the remaining
- All saving is invested and the rate is exogenous, s