DSGE Analysis of Knowledge-Intensive Industry and South Korea’s Economic Growth

Abstract

Based on the synergy theory of economic growth and the theory of supply-sidestructural reform, this paper establishes a dynamic stochastic general equilibriummodel group of economic growth in South Korea, does the in-depth research onurbanization, industrialization, informatization, agricultural modernization, foreigndebt, population, assets-liability ratio, industrial capacity utilization ratio, financialexpenditure, mid-to-high end industry, research and development personnel ofuniversity, funds from abroad, basic research funds, research and developmentpersonnel of private enterprise, technology trade, export, FDI, environmentalprotection funds/GDP, environment-related taxes, the proportion of high energyconsuming industries, fixed capital stock and so on, which affect economic growth,fiscal revenue, interest rate, exchange rate, non-performing loan, employment, fixedassets investment, human capital, science and technology, energy consumption, carbonemission, pollutant emissions, etc. , and establishes the relation models among them,constructs the DSGE equation group. MATLAB software is used to solve the modelsand simulate the simulation. Thus, it provides the experiences for the high quality ofmid-to-high growth of China under the new normal condition.