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The Determinants of Subsistence Income in a Malthusian World

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  • Paul Sharp
  • Holger Strulik
  • Jacob Weisdorf

Abstract

This study constructs a simple, two-sector Malthusian model with agriculture and industry, and uses it to identify the determinants of subsistence income. We make standard assumptions about preferences and production technology, but in contrast to existing studies we assume that children and other consumption goods are gross substitutes. Consistent with the conventional Malthusian model, the present theory shows that productivity growth in agriculture has no effect on subsistence income. More importantly, we also show that subsistence income varies, not just with the death rate as has recently been demonstrated in the literature, but also with the level of productivity in the industrial sector. An empirical analysis using data for pre-industrial England lends support to both hypotheses.

Suggested Citation

  • Paul Sharp & Holger Strulik & Jacob Weisdorf, 2010. "The Determinants of Subsistence Income in a Malthusian World," Global COE Hi-Stat Discussion Paper Series gd09-133, Institute of Economic Research, Hitotsubashi University.
    • Handle: RePEc:hst:ghsdps:gd09-133
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    References listed on IDEAS

    as
    1. Quamrul Ashraf & Oded Galor, 2011. "Dynamics and Stagnation in the Malthusian Epoch," American Economic Review, American Economic Association, vol. 101(5), pages 2003-2041, August.
    2. Kevin O’rourke & Jeffrey Williamson, 2005. "From Malthus to Ohlin: Trade, Industrialisation and Distribution Since 1500," Journal of Economic Growth, Springer, vol. 10(1), pages 5-34, January.
    3. Holger Strulik & Jacob Weisdorf, 2008. "Population, food, and knowledge: a simple unified growth theory," Journal of Economic Growth, Springer, vol. 13(3), pages 195-216, September.
    4. Gregory Clark, 2007. "Introduction to A Farewell to Alms: A Brief Economic History of the World," Introductory Chapters, in: A Farewell to Alms: A Brief Economic History of the World, Princeton University Press.
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    Cited by:

    1. Hans-Joachim Voth, 2013. "The Three Horsemen of Riches: Plague, War, and Urbanization in Early Modern Europe," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 80(2), pages 774-811.

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    More about this item

    Keywords

    Malthusian Model; Subsistence Income;

    JEL classification:

    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • N1 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development

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