Human Capital,R&D And Economic Growth

The interaction among human capital, innovation and economic growth is a main research subject in the new economic growth theory. In the1980's, the study as to economic growth often relates human capital and innovation are involved in. By studying, economists know that human capital and innovation are both the main source of the whole world on economic growth.The learning about growth is very profuse and complicated, and an important method of analyzing economic growth is dynamic optimization. This paper makes general management to some excessive hypothesis in early papers. One of the content of the research is that we analyze parental investment towards the education of children in one OLG model. The model study some factors which determine parental investment and show how parental investment can be most effective and how parental decision affects human capital accumulation of children. Meanwhile, we present the fiscal policy with human capital in endogenous growth Rebelo model and Uzawa-Lucas model, and we discuss the effects of income taxation on human capital accumulation and economic growth. In conclusion, tax rates affect neither the growth rate nor the allocation of human capital in Rebelo model, and the growth rate is equal to the growth rate of human capital. However, it should be observed that the presence of taxes on human capital income decreases both the accumulation of human capital and the consumption level of consumer. In Uzawa-Lucas model, however, the presence of taxes on human capital income doesn't affect the accumulation of human capital but decreases the consumption level.Seeing the important interrelation between human capital and innovation, we also consider how the research and development affect the economic growth. In the third model, we assume the goods sector and the R&D sector co-exit in the economic system. The total output is invested in consumption, production of physical capital and R&D sector. And the whole labors are allocated into the coexisting sector. There is a limitation of labor that is invested in R&D sector. In addition, the allocation of labor is significant and positive affect the output growth. At last we know the growth rate is equal to the technical growth rate.The issue of combination of human capital and innovation is another main content in this paper. In the forth model, we integrate human capital accumulation with innovation that is produced in R&D sector. We assume researchers who are encouraged by monopoly profits invest in developing new product. The solution of the model is a dynamic, equilibrium displaying transitional adjustment towards a unique steady state at which the economy at a constant, endogenous rate. The key aspect about this steady state growth rate is that it is determined by some parameters describing preferences and human capital technology and R&D activity. We discuss how human capital and innovation affect the growth rate, as well analyze how they interact. There are no scale effects in our model, as there are in nearly all other models based on R&D. Such effects imply a positive relationship between the growth rate of the economy and the level of resources devoted to R&D. And our model is able to generate sustainable long-run growth by virtue of human capital accumulation and innovation.