This thesis investigates the role of Information and Communication Technologies (ICT) and other intermediate goods in multi-sector growth models that aim to account for recent growth experiences of the United Kingdom and the United States. Chapter 2 examines how ICT drive growth in an economy with three sectors: ICT-producing, ICT-using and non-ICT-using. The benefits from ICT come from the falling prices of the ICT-using sector good, which is used for the production of intermediates. Their falling prices provide incentives for investment in sectors that use them as intermediate inputs, so the non-ICT-using sector experiences sustained growth driven by capital accumulation. Sectorial rates of growth differ, but the aggregate economy is on a constant growth path with constant labour shares across sectors. The model's predictions are consistent with evidence for the United States. Chapter 3 is an empirical study of the patterns of intermediates use in the United States and the United Kingdom. It shows that in both countries, since 1970s there is substitution of the goods-intermediates with the services ones in the gross output of the average industry. The increasing relative prices of the services-intermediates and the complementarity between intermediates types in the production is an important driver of this trend. The estimated elasticity of substitution is used to get measures of the latent technological and/ or policy factors that affect industries' choice of intermediates. Chapter 4 analyzes the impact of equity market information imperfections on R&D driven growth. The features of its production make R&D largely dependent on equity, which can be persistently mispriced, when the rational investors' beliefs are affected by both private and public information. Optimism in equity market raises R&D investment, resulting in technology improvement and thereby higher output, wages and consumption. Despite the capital losses, the mechanism can generate permanent gains in consumption.
| Identifer | oai:union.ndltd.org:bl.uk/oai:ethos.bl.uk:645750 |
| Date | January 2008 |
| Creators | Vourvachaki, Evangelia |
| Publisher | London School of Economics and Political Science (University of London) |
| Source Sets | Ethos UK |
| Detected Language | English |
| Type | Electronic Thesis or Dissertation |
| Source | http://etheses.lse.ac.uk/2574/ |
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