| Over the past century, all OECD countries have been characterized by a dramatic increase in economic conditions, life expectancy and educational attainment. This paper provides a positive theory that explains how an economy might evolve when the longevity of its citizens both influences and is influenced by the process of economic development. We propose a three periods OLG model where agents, during their lifetime, cover different economic roles characterized by different incentive schemes and time horizon. Agents decisions embrace two dimensions: the private choice about education and the public one upon innovation policy. The theory focuses on the crucial role played by heterogeneous interests in determining innovation policies, which are one of the... |
