Rate of Growth and Sectoral Specialisation Coevolution in an Export-Led Growth Model
The aim of this paper is to describe and simulate how the rate of growth and the specialisation coevolve in an export led growth model along Kaldorian tradition. The sector specialisation determines aggregate growth, while aggregate growth modifies sector specialisation, endogenous structural changes emerge. In this model the casual chain "growth - profits - technology - income elasticity of exports" describes explicitly the feedback from growth to exports. Moreover, sectors heterogeneity and the impact of sector specialisation on growth are considered; sectors are heterogeneous because of the different dynamic of profits and because of different income elasticities. Taking account of these two elements, growth and specialisation coevolve: an economic system convergers towards a medium-period macro equilibrium where the rate of growth and sector specialisation is constant. After some periods the system endogenously changes the regime of growth and shifts towards another equilibrium. The result is strongly path and time dependent. Some simulations show the strong differences in the possible patterns.
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