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The Path to Prosperity: A Political Model of Demographic Change

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Author Info
Yi Feng (Claremont Graduate University)
Jacek Kugler (Claremont Graduate University)
Paul Zak (Claremont Graduate University)

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Abstract

This paper presents a formal model that characterizes the political mechanisms of demographic change, establishing a critical link in economic development. We demonstrate that fertility decisions are determined by three fundamental political variables: political stability, political capacity and political freedom. Modeling strategic multi-objective policy setting by the government, we derive a set of equilibrium conditions that enable poor nations to escape a poverty trap and to successfully develop. Empirical tests for a sample of 100 countries from 1960 to 1990 provide strong support for the propositions of the formal model. In particular, we show that political stability, political capacity and political freedom all lead to reductions in birth rates. We conclude that politics can be either a stimulant or barrier to economic development.

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Paper provided by Claremont Colleges in its series Claremont Colleges Working Papers with number 1999-23.

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Handle: RePEc:clm:clmeco:1999-23

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  15. Cukierman, Alex & Edwards, Sebastian & Tabellini, Guido, 1992. "Seigniorage and Political Instability," American Economic Review, American Economic Association, vol. 82(3), pages 537-55, June. [Downloadable!] (restricted)
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  16. Birdsall, Nancy, 1988. "Economic approaches to population growth," Handbook of Development Economics, in: Hollis Chenery† & T.N. Srinivasan (ed.), Handbook of Development Economics, edition 1, volume 1, chapter 12, pages 477-542 Elsevier. [Downloadable!] (restricted)
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  20. Gary S. Becker & Kevin M. Murphy & Robert F. Tamura, 1990. "Human Capital, Fertility, and Economic Growth," NBER Working Papers 3414, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  21. Hanushek, Eric A, 1992. "The Trade-Off between Child Quantity and Quality," Journal of Political Economy, University of Chicago Press, vol. 100(1), pages 84-117, February. [Downloadable!] (restricted)
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  25. Barro, Robert J & Sala-i-Martin, Xavier, 1997. " Technological Diffusion, Convergence, and Growth," Journal of Economic Growth, Springer, vol. 2(1), pages 1-26, March. [Downloadable!] (restricted)
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  26. Barro, Robert J, 1996. " Democracy and Growth," Journal of Economic Growth, Springer, vol. 1(1), pages 1-27, March.
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