Economic Growth Model Based on Spatial Knowledge Spillover

Knowledge spillover and innovation agglomeration play important roles in regional economic growth.Based on the new theory of economic growth by Romer,an economic growth model is developed for the spatial knowledge spillover in relation to industrial agglomeration of innovation.The effects of both agglomeration and knowledge spillover on regional economic growth are thus studied in a new perspective.It is revealed that when globalizing the knowledge spillover,the per capita output growth rate bears no relation to the spatial distribution of innovation sectors.When localizing it,however,in the region where the innovation sectors are dominant in its industrial distribution the per capita output grows with increasing knowledge spillover and agglomeration but,if the innovation sectors are not dominant,the per capita output growth rate will drop off at a speed that is slowed down due to the resilience of knowledge spillover.