Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/251943 
Year of Publication: 
2022
Citation: 
[Journal:] Theoretical and Practical Research in Economic Fields [ISSN:] 2068-7710 [Volume:] XIII [Issue:] 1 (forthcoming) [Publisher:] ASERS Publishing [Place:] Craiova [Year:] 2022
Publisher: 
ASERS Publishing, Craiova
Abstract: 
We utilize a relatively standard endogenous growth model with intermediaries and research and development (R&D). We augment the setup with government regulations to study the effect of regulations on aggregate allocations. The novelty is that we endogeneize the problem of the regulator, so the number of regulations is determined within the model. Next, we solve the model and derive some comparative static results. The qualitative results confirm that more regulation leads to a lower number intermediaries, but each of those is now larger. Investment in physical capital is higher, but that comes at the expense of lower investment in R&D, lower consumption, lower output, and lower welfare. Overall, the intuition that regulation is bad for the economy is confirmed.
Subjects: 
Endogenous growth model
R&D
JEL: 
E6
L5
Document Type: 
Article
Document Version: 
Accepted Manuscript (Postprint)
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