An Evaluation of the Relevance of the AK Model to Developing Countries Such as Zimbabwe

Abstract

AK models, unlike the exogenous models, factor in technology as endogenously determined within the model by economic decisions; hence they are also called endogenous models. This paper serves to outline the AK model as propounded by Frankel (1962) as well as to evaluate its relevance to a developing country. A theoretical approach is used to analyse its relevance. It was noted that, the AK model by Frankel (1962) is relevant to developing countries as it helps to combat the major impediments to economic growth faced in these countries such as low productivity, high unemployment, low levels of investment and dilapidated infrastructure. Capital accumulation will also bring positive externalities through learning by doing effects. The model might nevertheless fail to bring desired results since it does not consider other factors such as political instability and good institutions which equally contribute to economic growth.

Keywords: Developing Countries, AK Model, Endogenous Model, Zimbabwe