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A note on endogenous growth and scale effects

Authors:	Phillip Garner

Institution:	1. School of Chemistry and Chemical Engineering, Key Laboratory of Special Functional Aggregated Materials, Ministry of Education, Shandong University, Shanda Nanlu 27, 250199 Jinan, China;2. Marine College, Shandong University at Weihai, Weihai 264209, China;3. Department of Chemistry, Capital Normal University, 100037 Beijing, China;4. Institut für Nanotechnologie (INT) und Karlsruher Nano-Micro-Facility (KNMF), Karlsruher Institut für Technologie (KIT), Hermann-von-Helmholtz-Platz 1, 76344 Eggenstein-Leopoldshafen, Germany

Abstract:	This paper reconciles the recent vs. very long-run evidence on scale effects in endogenous growth models by extending Howitt's (1999) model to include a subsistence constraint in consumption. Scale effects will be present only when this constraint is binding.

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