This file is part of IDEAS, which uses RePEc data


[ Papers | Articles | Software | Books | Chapters | Authors | Institutions | JEL Classification | NEP reports | Search | New papers by email | Author registration | Rankings | Volunteers | FAQ | Blog | Help! ]

Wealth breeds decline : reversals of leadership and consumption habits

Author info | Abstract | Publisher info | Download info | Related research | Statistics
Author Info
ARTIGE, Lionel
CAMACHO, Carmen
de la CROIX, David

Additional information is available for the following registered author(s):

Abstract

In a two-region model, we formalize Kindleberger's idea that wealth breeds first more wealth, and then decline: when one region leads, its inhabitants develop consumption habits incompatible with the necessary investment in knowledge to remain the leader. This gives the other region a window of opportunity to gain economic primacy. We learn from the theoretical model that differences across regions that have similar characteristics may persist even if physical capital flows from rich to poor regions. By exploiting the economics of the Hopf bifurcation we study patterns of alternating primacy, irreversible decline, and monotonic convergence, according to the initial dispersion of knowledge and the strength of consumption habits. Even though exogenous factors may matter on some occasions, we show that they are not necessary to reverse economic leadership.

Download Info
To download:

If you experience problems downloading a file, check if you have the proper application to view it first. Information about this may be contained in the File-Format links below. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.core.ucl.ac.be/services/psfiles/dp03/dp2003-54.pdf
File Format: application/pdf
File Function:
Download Restriction: no

Publisher Info
Paper provided by Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) in its series CORE Discussion Papers with number 2003054.

Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Length:
Date of creation: 01 Jul 2003
Date of revision:
Handle: RePEc:cor:louvco:2003054

Contact details of provider:
Postal: Voie du Roman Pays 34, 1348 Louvain-la-Neuve (Belgium)
Phone: 32(10)474321
Fax: +32 10474301
Email:
Web page: http://www.uclouvain.be/core
More information through EDIRC

For technical questions regarding this item, or to correct its listing, contact: (Alain GILLIS).

Related research
Keywords: consumption habits; over-taking; regional primacy; capital mobility;

Other versions of this item:

Find related papers by JEL classification:
R11 - Urban, Rural, and Regional Economics - - General Regional Economics - - - Analysis of Growth, Development, and Changes
O41 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
E21 - Macroeconomics and Monetary Economics - - Macroeconomics: Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
N10 - Economic History - - Macroeconomics and Monetary Economics; Growth and Fluctuations - - - General, International, or Comparative

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

  1. Klaus Desmet, 2002. "A Simple Dynamic Model of Uneven Development and Overtaking," Economic Journal, Royal Economic Society, vol. 112(482), pages 894-918, October. [Downloadable!] (restricted)
  2. Galor, Oded, 1996. "Convergence? Inferences from Theoretical Models," Economic Journal, Royal Economic Society, vol. 106(437), pages 1056-69, July. [Downloadable!] (restricted)
    Other versions:
  3. de la Croix, David, 2001. "Growth dynamics and education spending: The role of inherited tastes and abilities," European Economic Review, Elsevier, vol. 45(8), pages 1415-1438, August. [Downloadable!] (restricted)
  4. Robert J. Barro & Xavier Sala-i-Martin, 1991. "Convergence across States and Regions," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 22(1991-1), pages 107-182. [Downloadable!]
    Other versions:
  5. Buiter, Willem H, 1981. "Time Preference and International Lending and Borrowing in an Overlapping-Generations Model," Journal of Political Economy, University of Chicago Press, vol. 89(4), pages 769-97, August. [Downloadable!] (restricted)
    Other versions:
  6. Clark, Andrew E. & Oswald, Andrew J. & Warr, Peter B., 1994. "Is job satisfaction u-shaped in age ?," CEPREMAP Working Papers (Couverture Orange) 9407, CEPREMAP.
  7. Gianmarco Ottaviano & Takatoshi Tabuchi & Jacques-FranÁois Thisse, 2002. "Agglomeration and Trade Revisited," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 43(2), pages 409-436, May. [Downloadable!] (restricted)
    Other versions:
  8. Brezis, Elise S & Krugman, Paul R & Tsiddon, Daniel, 1993. "Leapfrogging in International Competition: A Theory of Cycles in National Technological Leadership," American Economic Review, American Economic Association, vol. 83(5), pages 1211-19, December. [Downloadable!] (restricted)
  9. de la Croix, David, 1998. "Growth and the relativity of satisfaction," Mathematical Social Sciences, Elsevier, vol. 36(2), pages 105-125, September. [Downloadable!] (restricted)
  10. Benabou, Roland, 1996. "Heterogeneity, Stratification, and Growth: Macroeconomic Implications of Community Structure and School Finance," American Economic Review, American Economic Association, vol. 86(3), pages 584-609, June. [Downloadable!] (restricted)
  11. Daron Acemoglu & Simon Johnson & James A. Robinson, 2002. "Reversal Of Fortune: Geography And Institutions In The Making Of The Modern World Income Distribution," The Quarterly Journal of Economics, MIT Press, vol. 117(4), pages 1231-1294, November. [Downloadable!] (restricted)
    Other versions:
  12. Mountford, A., 1996. "Gradual Convergence Under Perfect International Capital Mobility," Discussion Paper Series In Economics And Econometrics 9633, Economics Division, School of Social Sciences, University of Southampton.
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Matthias Doepke, . "Patience Capital, Occupational Choice, and the Spirit of Capitalism," UCLA Economics Online Papers 410, UCLA Department of Economics. [Downloadable!]
    Other versions:
  2. Richard C. Barnett & Joydeep Bhattacharya, 2007. "Rejuveniles and Growth," Economics Working Papers 2007-11, School of Economics and Management, University of Aarhus. [Downloadable!]
    Other versions:
  3. Doepke, Matthias & Zilibotti, Fabrizio, 2007. "Occupational Choice and the Spirit of Capitalism," CEPR Discussion Papers 6405, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
  4. Cuberes, David, 2008. "Democracy, Diversification, and Growth Reversals," MPRA Paper 8430, University Library of Munich, Germany. [Downloadable!]
    Other versions:
  5. Woźny, Łukasz & Growiec, Jakub, 2008. "Intergenerational interactions in human capital accumulation," MPRA Paper 10308, University Library of Munich, Germany. [Downloadable!]
Statistics
Access and download statistics

Did you know? Authors registered on the RePEc Author Service receive monthly emails with details about downloads and abstract views of their works.

This page was last updated on 2009-11-19.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.