Looking Back on Romer (1990)

January 25, 2016 1:07 PM

25 years ago, Paul M. Romer's oft-cited article: "Endogenous Technological Change" (pdf) was published in The Journal of Political Economy. In it, he tried to explain how technological progress and knowledge creation affected the dynamics of growth. Romer’s model (pdf) became the "primary engine that fueled a decade-long re-examination of long-term growth in economics." This past October, Dr. Romer posted 7 follow-up blog entries to his historic paper, in order to 'revisit the basics,' starting with: Nonrival Goods After 25 Years.

The Series
1) Nonrival Goods After 25 Years
2) Human Capital and Knowledge
3) Clear Writing Produces Clearer Thoughts
4) Economic Growth: Compounding
5) Speeding Up and Missed Opportunities: Evidence
6) Speeding Up: Theory
7) Where has all the excludability gone?

Background
* Wikipedia on Endogenous Growth Theory and Dr. Romer.
* TEDGlobal 2009: Why the world needs charter cities
* The Library of Economics and Liberty has a 75-minute 2007 EconoTalk podcast interview with Dr. Romer.

posted by zarq (5 comments total)

There's a lot of content in this post. If you're looking for an interesting starting point, I liked "Economic Growth: Compounding." It places you in the middle of his train of thought, so to speak, but it's a good stand-alone essay.
posted by zarq at 1:09 PM on January 25, 2016 [2 favorites]

A somewhat dismissive comment from Krugman: "...too much of it involved making assumptions about how unmeasurable things affected other unmeasurable things," and "The reasons some countries grow more successfully than others remain fairly mysterious, with most discussions ending, as Robert Solow remarked long ago, in a 'blaze of amateur sociology'."
posted by clawsoon at 1:52 PM on January 25, 2016

I remember this dude getting glowing write ups in Wired magazine back in the late 90's before the first dotcom bust put a damper on the "ideas (no matter how stupid) = profits" kind of thinking.
posted by PenDevil at 10:50 PM on January 25, 2016

Interesting stuff. It's fascinating how much the (erm) idiosyncratic Chicago school approaches to methodology in economics comes through here. On the one hand he's absolutely wedded to calling Becker's useful but value-laden conception of "human capital" as a "true microfoundation" that's really how the brain works (and muscles too, they're just the same! ); on the other ya know decentralization's just like a planning problem.
posted by hawthorne at 4:13 AM on January 26, 2016

a "true microfoundation" that's really how the brain works

Yeah, I was surprised at the "neurons are a limited resource; if you learn one thing you will forget something else" view, without acknowledgement that a multiplicative effect can happen with learning, too, where learning a few foundational things (language, reading, math) can lead to an explosion of knowledge, at least for a while. (S-curves all around...)
posted by clawsoon at 7:33 AM on January 26, 2016