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Population growth overshooting and trade in developing countries

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  • Ulla Lehmijoki

    ()

  • Tapio Palokangas

    ()

Abstract

This paper examines a developing economy by a family-optimization model in which the number of children is a normal good in preferences. Trade liberalization generates two effects: an income effect, which raises population growth in the short run; and a gender wage effect, which decreases that in the long run. With higher income, families invest more in capital. Because female labor is more complementary to capital, a higher level of investment increases women's relative wages and attracts more of them from child rearing into production. Consequently, the population growth rate falls below the original level in the long run. This paper also provides some empirical evidence on these results.

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Bibliographic Info

Article provided by Springer in its journal Journal of Population Economics.

Volume (Year): 22 (2009)
Issue (Month): 1 (January)
Pages: 43-56

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Handle: RePEc:spr:jopoec:v:22:y:2009:i:1:p:43-56

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Related research

Keywords: Population growth; International trade; O41; J13; J16;

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  1. Fisher, Walter H. & Hof, Franz X., 2005. "Status seeking in the small open economy," Journal of Macroeconomics, Elsevier, vol. 27(2), pages 209-232, June.
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Cited by:
  1. Ulla Lehmijoki & Tapio Palokangas, 2010. "Trade, population growth, and the environment in developing countries," Journal of Population Economics, Springer, vol. 23(4), pages 1351-1370, September.

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