Yale Economic Growth Center Discussion Paper: 621 December 1990, pp. 44.
This is a survey of the literature on Economic Growth. In the introduction we analyze the main differences between exogenous and endogenous growth models using fixed savings rate analysis. We argue that in order to have endogenous growth there must be constant returns to the factors that can be accumulated. A graphical tool is then developed to show that changes in the savings rate have different effects on long-run growth in the two kinds of models. We show that only endogenous growth models are affected by shifts in the savings rate. We then explore two versions of the Ramsey-Cass- Koopmans neoclassical model where savings are determined optimally: one with exogenous productivity growth and one without.