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Population growth overshooting and trade in developing countries

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  • Ulla Lehmijoki

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  • Tapio Palokangas

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Abstract

This paper examines a developing economy by a family-optimization model in which the number of children is a normal good in preferences. Trade liberalization generates two effects: an income effect, which raises population growth in the short run; and a gender wage effect, which decreases that in the long run. With higher income, families invest more in capital. Because female labor is more complementary to capital, a higher level of investment increases women's relative wages and attracts more of them from child rearing into production. Consequently, the population growth rate falls below the original level in the long run. This paper also provides some empirical evidence on these results.
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Suggested Citation

  • Ulla Lehmijoki & Tapio Palokangas, 2009. "Population growth overshooting and trade in developing countries," Journal of Population Economics, Springer;European Society for Population Economics, vol. 22(1), pages 43-56, January.
  • Handle: RePEc:spr:jopoec:v:22:y:2009:i:1:p:43-56
    DOI: 10.1007/s00148-007-0144-9
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    References listed on IDEAS

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    16. Alessandro Cigno, 1998. "Fertility decisions when infant survival is endogenous," Journal of Population Economics, Springer;European Society for Population Economics, vol. 11(1), pages 21-28.
    17. Chang, Wen-ya & Hsieh, Yi-ni & Lai, Ching-chong, 2000. "Social status, inflation, and endogenous growth in a cash-in-advance economy," European Journal of Political Economy, Elsevier, vol. 16(3), pages 535-545, September.
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    Cited by:

    1. Thomas Gries & Rainer Grundmann, 2014. "Trade and fertility in the developing world: the impact of trade and trade structure," Journal of Population Economics, Springer;European Society for Population Economics, vol. 27(4), pages 1165-1186, October.
    2. Lehmijoki, Ulla & Palokangas, Tapio K., 2016. "Fertility, Mortality and Environmental Policy," IZA Discussion Papers 10465, Institute for the Study of Labor (IZA).
    3. Ulla Lehmijoki & Tapio Palokangas, 2016. "Land reforms and population growth," Portuguese Economic Journal, Springer;Instituto Superior de Economia e Gestao, vol. 15(1), pages 1-15, April.
    4. Aleksandr Tarasyev & Ilya Krivenko & Maria Pecherkina & Tatiana Kashina, 2016. "Simulation of the Investment Attractiveness of Science in a Region," Economy of region, Centre for Economic Security, Institute of Economics of Ural Branch of Russian Academy of Sciences, vol. 1(1), pages 303-314.
    5. Ulla Lehmijoki & Tapio Palokangas, 2010. "Trade, population growth, and the environment in developing countries," Journal of Population Economics, Springer;European Society for Population Economics, vol. 23(4), pages 1351-1370, September.

    More about this item

    Keywords

    Population growth; International trade; O41; J13; J16;

    JEL classification:

    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination

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