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A theory of medical effectiveness, differential mortality, income inequality and growth for pre-industrial England

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  • DE LA CROIX, David
  • SOMMACAL, Alessandro

Abstract

The interactions between mortality reductions and income growth are studied, with a special attention at their relationship prior to the Industrial Revolution, when income per head was stagnant. The choice of individual medical spending is modelled, giving a rationale for individual health expenditures even when medicine is not effective in postponing death. The rise of effective medicine is then explained by a learning process function of expenditure on health. The rise in effective medicine is linked to the economic growth of the eighteenth century through life expectancy increases which foster capital accumulation. The rise of effective medicine has also had an effect on the relationship between growth and inequality and on the intergenerational persistence of differences in income. These channels are operative through differential mortality induced by medical effectiveness that turns out to determine a differential in the propensity to save among income groups.

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File URL: http://dx.doi.org/10.1080/08898480802619538
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Paper provided by Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) in its series CORE Discussion Papers RP with number -2103.

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Handle: RePEc:cor:louvrp:-2103

Note: In : Mathematical Population Studies, 16, 2-35, 2009
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  1. Oded Galor & Omer Moav, 2004. "Natural Selection and the Evolution of Life Expectancy," GE, Growth, Math methods 0409004, EconWPA.
  2. Shankha Chakraborty, 2002. "Endogenous Lifetime and Economic Growth," University of Oregon Economics Department Working Papers 2002-03, University of Oregon Economics Department, revised 26 Jan 2002.
  3. David de la Croix & Omar Licandro, . "Life expectancy and endogenous growth," Working Papers 97-23, FEDEA.
  4. Zhang, Junsen & Zhang, Jie & Lee, Ronald, 2001. "Mortality decline and long-run economic growth," Journal of Public Economics, Elsevier, vol. 80(3), pages 485-507, June.
  5. Matteo Cervellati & Uwe Sunde, 2005. "Human Capital Formation, Life Expectancy, and the Process of Development," American Economic Review, American Economic Association, vol. 95(5), pages 1653-1672, December.
  6. Nicolini, Esteban A., 2004. "Mortality, interest rates, investment, and agricultural production in 18th century England," Explorations in Economic History, Elsevier, vol. 41(2), pages 130-155, April.
  7. Amparo Castello-Climent & Rafael Domenech, 2006. "Human Capital Inequality, Life Expectancy and Economic Growth," Working Papers 0604, International Economics Institute, University of Valencia.
  8. Olivier F. Morand, 2002. "Economic Growth, Longevity, and the Epidemiological Transition," Working papers 2002-07, University of Connecticut, Department of Economics.
  9. Oded Galor & Omer Moav, 2004. "From Physical to Human Capital Accumulation: Inequality and the Process of Development," Review of Economic Studies, Oxford University Press, vol. 71(4), pages 1001-1026.
  10. David N. Weil & Oded Galor, 2000. "Population, Technology, and Growth: From Malthusian Stagnation to the Demographic Transition and Beyond," American Economic Review, American Economic Association, vol. 90(4), pages 806-828, September.
  11. Galor, Oded & Weil, David, 1999. "From Malthusian Stagnation to Modern Growth," CEPR Discussion Papers 2082, C.E.P.R. Discussion Papers.
  12. Raouf Boucekkine & David de la Croix & Omar Licandro, 2003. "Early Mortality Declines at the Dawn of Modern Growth," Scandinavian Journal of Economics, Wiley Blackwell, vol. 105(3), pages 401-418, 09.
  13. Robinson, James A & Verdier, Thierry, 2002. "The Political Economy of Clientelism," CEPR Discussion Papers 3205, C.E.P.R. Discussion Papers.
  14. Shankha Chakraborty & Mausumi Das, 2005. "Mortality, Human Capital and Persistent Inequality," Journal of Economic Growth, Springer, vol. 10(2), pages 159-192, 06.
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Cited by:
  1. Pierre Pestieau & Grégory Ponthière, 2012. "The public economics of increasing longevity," PSE Working Papers halshs-00676492, HAL.
  2. DE LA CROIX, David & LICANDRO, Omar, 2007. "‘The child is father of the man’: implications for the demographic transition," CORE Discussion Papers 2007072, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  3. repec:hal:wpaper:halshs-00676492 is not listed on IDEAS
  4. Fabio Mariani & Agustin Pérez-Barahona & Natacha Raffin, 2008. "Life expectancy and the environment," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00318677, HAL.
  5. David, DE LA CROIX, 2008. "Adult longevity and economic take-off : from Malthus to Ben-Porath," Discussion Papers (ECON - Département des Sciences Economiques) 2008031, Université catholique de Louvain, Département des Sciences Economiques.
  6. Thomas Seegmuller & Stefano Bosi, 2010. "Mortality Differential, Labor Taxation And Growth: What Do We Learn From The Barro-Becker Model?," Working Papers halshs-00472732, HAL.

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