Life Expectancy, Human Capital Accumulation, Technological Adoption and the Process of Economic Growth

This chapter 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. This analysis is based on recently advanced unified growth theories and captures the intricate evolution of income per-capita, technology, human capital and life expectancy over the course of human history. We base our explanation on the three periods OLG model proposed by Lancia and Prarolo (2007) where agents, during their lifetime, cover different economic roles characterized by different incentive schemes and time horizon. As in the above mentioned work, we assume that 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 keys to the growth process: the economy can be discontinuously innovation-oriented due to the different incentives of individuals and different schemes of political aggregation of preferences.