Endogenous growth in a cross-section of countries

We estimate two versions of Romer's model of endogenous technological change that allow for population growth and human capital accumulation. In one of these versions, estimates from international cross-sectional data yield parameter values that are consistent with prior information, and tests of overidentifying restrictions are not rejected. Trade openness increases the effectiveness with which human capital generates new knowledge, and improves the model's predictive performance. The Romer model represents a valuable template on which to build mon sophisticated models of endogenous long-run growth without scale effects. (C) 2000 Elsevier Science B.V. All rights reserved.