Population in factor accumulation-based growth
AbstractThis paper analyzes the conditions under which, within a two-sector endogenous growth model with human and physical capital accumulation but without R&D-driven disembodied technological progress, it is possible to observe an ambiguous effect of population growth on economic growth, as empirical evidence suggests. We present three models. In each of them the engine of long-run growth is human capital accumulation. Population growth exerts ambiguous effects on economic growth only when human and physical capital are complementary for each other in the production of new human capital. This result is explained in terms of the interplay between the “dilution” and “accumulation” effects. In accordance with the growth literature exhibiting endogenous human capital accumulation and R&D activity, we also find that income growth can be positive even with stable population, that both the growth rate and the level of per-capita income are independent of population size, and finally that the level of per-capita income is proportional to per-capita human capital. We conclude that it is possible to reach the same results even without explicitly assuming endogenous and purposeful investment in research by firms
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Bibliographic InfoPaper provided by Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano in its series Departmental Working Papers with number 2008-17.
Date of creation: 09 Jun 2008
Date of revision:
Population Size and Growth; Scale Effects; Per-Capita Income; Economic Growth; Human Capital Investment; Physical Capital Accumulation;
Other versions of this item:
- O41 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
- J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
- J10 - Labor and Demographic Economics - - Demographic Economics - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-06-17 (All new papers)
- NEP-DEV-2009-06-17 (Development)
- NEP-DGE-2009-06-17 (Dynamic General Equilibrium)
- NEP-FDG-2009-06-17 (Financial Development & Growth)
- NEP-HRM-2009-06-17 (Human Capital & Human Resource Management)
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