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Productive consumption and population dynamics in an endogenous growth model: Demographic trends and human development aid in developing economies

  • Daitoh, Ichiroh
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    We find that by endogenizing the population growth rate, a growth model under the productive consumption hypothesis is more tractable than models in previous studies and has interesting implications for population dynamics. In the zero-saving phase, multiple saddle point stable steady states may exist, and the population growth rate may rise or decline along a transition path. In the positive-saving phase, such a steady state may exist uniquely, and the population growth rate may decline. With phase switching, the population growth rate may follow an inverted U-shaped curve. Human development aid may help an economy escape from an underdevelopment trap.

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    File URL: http://www.sciencedirect.com/science/article/B6V85-4XSJVHR-2/2/9e9040591810c51850f05c107b4bbd62
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    Article provided by Elsevier in its journal Journal of Economic Dynamics and Control.

    Volume (Year): 34 (2010)
    Issue (Month): 4 (April)
    Pages: 696-709

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    Handle: RePEc:eee:dyncon:v:34:y:2010:i:4:p:696-709
    Contact details of provider: Web page: http://www.elsevier.com/locate/jedc

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