Aggregate economies of scale are the engine of growth in models with quasi-endogenous research: larger populations are linked to a higher stock of non-rival ideas (see Jones, 1995; Kortum, 1997; Eaton and Kortum, 2001). Thus, growth rates of per capita real output are proportional to population growth rates, gy = ε · gL, where the parameter ɛ is the efficiency-size elasticity.