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Productive consumption and population dynamics in an endogenous growth model: Demographic trends and human development aid in developing economies

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  • Daitoh, Ichiroh
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    Abstract

    We find that by endogenizing the population growth rate, a growth model under the productive consumption hypothesis is more tractable than models in previous studies and has interesting implications for population dynamics. In the zero-saving phase, multiple saddle point stable steady states may exist, and the population growth rate may rise or decline along a transition path. In the positive-saving phase, such a steady state may exist uniquely, and the population growth rate may decline. With phase switching, the population growth rate may follow an inverted U-shaped curve. Human development aid may help an economy escape from an underdevelopment trap.

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    Bibliographic Info

    Article provided by Elsevier in its journal Journal of Economic Dynamics and Control.

    Volume (Year): 34 (2010)
    Issue (Month): 4 (April)
    Pages: 696-709

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    Handle: RePEc:eee:dyncon:v:34:y:2010:i:4:p:696-709

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    Web page: http://www.elsevier.com/locate/jedc

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    Keywords: Endogenous growth Population dynamics Productive consumption;

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