Estimating Optimum Value of Investment and Human Capital in the R&D Sector of Iran Using an Augmented Endogenous Growth Model

This article intends to estimate the optimal value of investment and human capital in r&d sector of iranian economy using an augmented endogenous growth model. to do so, two issues have been studied. first, an endogenous growth model has been extended to include investment in r&d as an independent variable. in the framework of this model, in order to determine the optimal value of investment and human capital in r&d sector, we derived the optimal path. second, using the optimal path and iran’s economic data, the optimal values of human capital and investment in iran’s r&d sector have been estimated. the results show that in order to be in a steady state with 8% economic growth, it’s necessary to allocate 0.7% of total human capital and 8% of national income to r&d sector. however, at present, less than 0.3% of human capital and less than 0.5% of national income is allocated to r&d sector in the iranian economy.