Tasa de depreciación endógena y crecimiento económico

Abstract

We study the features of the incentives for investing in capital goods with higer durability. We argue that economies which invest in capital goods with less durability may have a lower economic growth. We build a theoretical model with endogenous depreciation rate. The model we present is one of technical innovations. Technologies are differentiated by depreciation rates and smaller depreciation rates are more costly. In this setting there can be more than one steady state because of the complementarity between capital and depreciation rates. The main result of the paper is the existence of poverty traps with high depreciation rates.