A SIMPLE-MODEL OF SCHUMPETERIAN GROWTH WITH COMPLEX DYNAMICS

In this paper, we develop a Schumpeterian discrete-time model of endog enous growth with an explicit market for the resource used for innovat ion-creating investment, and study its global dynamics. We show, among others, that the level of investment may fluctuate chaotically for a compact range of model parameters, as a consequence of the explicit in termediation and market imperfections (temporary monopoly power follow ing an innovation) underlying the growth process.