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Growth and Enduring Epidemic Diseases

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  • Clive Bell
  • Hans Gersbach

Abstract

This paper studies the formation of human capital and its transmission across generations when premature adult mortality is a salient feature of the demographic landscape, either permanently or in the form of a long-period wave that follows the outbreak of an epidemic. We establish several threshold properties of the model, for such a shock can severely retard economic growth, even to the point of leading to an economic collapse. Premature adult mortality may exacerbate inequality under nuclear family arrangements. Pooling mortality risks with equal treatment of all children may fend off, or even induce, a collapse, depending on the initial conditions and the size and duration of the shock. Awareness campaigns may also trigger a collapse by introducing undesirable expectational feedbacks.

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Bibliographic Info

Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 1729.

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Date of creation: 2006
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Handle: RePEc:ces:ceswps:_1729

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Keywords: epidemic diseases; HIV/AIDS; growth; collapse; pooling;

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References

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  1. David E. Bloom & David Canning & Jaypee Sevilla, 2001. "The Effect of Health on Economic Growth: Theory and Evidence," NBER Working Papers 8587, National Bureau of Economic Research, Inc.
  2. Galor, Oded & Weil, David, 1998. "Population, Technology and Growth: From the Malthusian Regime to the Demographic Transition," CEPR Discussion Papers, C.E.P.R. Discussion Papers 1981, C.E.P.R. Discussion Papers.
  3. Nils-Petter Lagerl–f, 2003. "From Malthus to Modern Growth: Can Epidemics Explain the Three Regimes?," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 44(2), pages 755-777, 05.
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  6. Yamano, Takashi & Jayne, Thomas S., 2004. "Working-Age Adult Mortality and Primary School Attendance in Rural Kenya," Food Security Collaborative Working Papers, Michigan State University, Department of Agricultural, Food, and Resource Economics 55159, Michigan State University, Department of Agricultural, Food, and Resource Economics.
  7. Gilbert,Christopher L. & Vines,David (ed.), 2006. "The World Bank," Cambridge Books, Cambridge University Press, Cambridge University Press, number 9780521029018.
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  11. Raouf Boucekkine & Jean-Pierre Laffargue, 2009. "On the distributional consequences of epidemics," Working Papers, Business School - Economics, University of Glasgow 2009_22, Business School - Economics, University of Glasgow.
  12. BOUCEKKINE, Raouf & DESBORDES, Rodolphe & LATZER, Hélène, . "How do epidemics induce behavioral changes?," CORE Discussion Papers RP, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) -2160, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
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  15. repec:rus:hseeco:71105 is not listed on IDEAS
  16. David Evans & Edward Miguel, 2007. "Orphans and schooling in africa: a longitudinal analysis," Demography, Springer, Springer, vol. 44(1), pages 35-57, February.
  17. Clive Bell & Shantayanan Devarajan & Hans Gersbach, 2003. "The long-run economic costs of AIDS : theory and an application to South Africa," Policy Research Working Paper Series 3152, The World Bank.
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  20. Bell, Clive & Gersbach, Hans, 2009. "Child Labor And The Education Of A Society," Macroeconomic Dynamics, Cambridge University Press, Cambridge University Press, vol. 13(02), pages 220-249, April.
  21. Johansson, Lars M., 2007. "Fiscal implications of AIDS in South Africa," European Economic Review, Elsevier, Elsevier, vol. 51(7), pages 1614-1640, October.
  22. Kathleen Beegle & Joachim Weerdt & Stefan Dercon, 2010. "Orphanhood and human capital destruction: Is there persistence into adulthood?," Demography, Springer, Springer, vol. 47(1), pages 163-180, February.
  23. Clive Bell & Shantayanan Devarajan & Hans Gersbach, 2006. "The Long-Run Economic Costs of aids: A Model with an Application to South Africa," World Bank Economic Review, World Bank Group, World Bank Group, vol. 20(1), pages 55-89.
  24. Corrigan, Paul & Glomm, Gerhard & Mendez, Fabio, 2005. "AIDS crisis and growth," Journal of Development Economics, Elsevier, Elsevier, vol. 77(1), pages 107-124, June.
  25. Bruhns, Ramona, 2006. "The Long-run Effects of HIV/AIDS in Kenya," MPRA Paper 952, University Library of Munich, Germany.
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Citations

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Cited by:
  1. Edward J. Balistreri & Russell H. Hillberry & Thomas F. Rutherford, 2008. "Structural Estimation and Solution of International Trade Models with Heterogeneous Firms," CER-ETH Economics working paper series 08/89, CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich.
  2. Chrysovalantis VASILAKIS, 2010. "The social economic impact of AIDS: Accounting for intergenerational transmission, productivity and fertility," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales), Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES) 2010046, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
  3. Boucekkine, Raouf & Laffargue, Jean-Pierre, 2010. "On the distributional consequences of epidemics," Journal of Economic Dynamics and Control, Elsevier, Elsevier, vol. 34(2), pages 231-245, February.
  4. Ben J. Heijdra & Jenny Ligthart, 2006. "Fiscal Policy, Monopolistic Competition, and Finite Lives," CESifo Working Paper Series 1661, CESifo Group Munich.

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