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Growth and enduring epidemic diseases

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  • Bell, Clive
  • Gersbach, Hans

Abstract

This paper analyzes the interplay of human capital formation and economic growth when there is premature adult mortality. Failing adequate insurance arrangements, a long wave of such mortality can so undermine human capital formation as to induce an economic collapse. In nuclear family structures, random matching of partners is superior to assortative mating only if the shock is not too big and initial levels of human capital are not too low. Full pooling of mortality risks with equal treatment of all children in extended families may fend off a general collapse, depending on the initial conditions and the size and duration of the shock. To avoid undesirable effects on expectations, awareness campaigns should be complemented by policies that credibly promise to reduce future mortality. If mortality depends on the general level of human capital, indeterminacy can arise in the form of more than one rational expectations path.

Suggested Citation

  • Bell, Clive & Gersbach, Hans, 2013. "Growth and enduring epidemic diseases," Journal of Economic Dynamics and Control, Elsevier, vol. 37(10), pages 2083-2103.
  • Handle: RePEc:eee:dyncon:v:37:y:2013:i:10:p:2083-2103
    DOI: 10.1016/j.jedc.2013.04.011
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    References listed on IDEAS

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    Cited by:

    1. Gori, Luca & Lupi, Enrico & Manfredi, Piero & Sodini, Mauro, 2017. "Can HIV alter the quantity-quality switch and delay the fertility transition in Sub-Saharan Africa?," GLO Discussion Paper Series 75, Global Labor Organization (GLO).
    2. Balistreri, Edward J. & Hillberry, Russell H. & Rutherford, Thomas F., 2011. "Structural estimation and solution of international trade models with heterogeneous firms," Journal of International Economics, Elsevier, vol. 83(2), pages 95-108, March.
    3. Richard S J Tol, 2018. "The Economic Impacts of Climate Change," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 12(1), pages 4-25.
    4. Vasilakis, Chrysovalantis, 2012. "The social economic impact of AIDS: Accounting for intergenerational transmission, productivity and fertility," Economic Modelling, Elsevier, vol. 29(2), pages 369-381.
    5. Boucekkine, Raouf & Laffargue, Jean-Pierre, 2010. "On the distributional consequences of epidemics," Journal of Economic Dynamics and Control, Elsevier, vol. 34(2), pages 231-245, February.
    6. Laps, Jochen, 2016. "Fully Funded Social Security Pensions, Lifetime Risk and Income," Annual Conference 2016 (Augsburg): Demographic Change 145587, Verein für Socialpolitik / German Economic Association.
    7. Luca Gori & Enrico Lupi & Piero Manfredi & Mauro Sodini, 2017. "Can HIV alter the quantity-quality switch and delay the fertility transition in Sub-Saharan Africa?," CEIS Research Paper 416, Tor Vergata University, CEIS, revised 08 Dec 2017.
    8. Laps, Jochen, 2015. "Fully Funded Social Security Pensions, Lifetime Risk and Income," Working Papers 0603, University of Heidelberg, Department of Economics.

    More about this item

    Keywords

    Epidemic diseases; HIV/AIDS; Growth; Collapse; Pooling;

    JEL classification:

    • I10 - Health, Education, and Welfare - - Health - - - General
    • I20 - Health, Education, and Welfare - - Education - - - General
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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