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Endogenous Versus Exogenous Growth Facing a Fertility Shock

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  • Medeiros, João

    (European Commission, Directorate General of Economic and Financial Affairs)

Abstract

This paper simulates the impact of a permanent fertility shock on economic growth, using endogenous versus exogenous growth OLG models. An endogenous growth model, with education as the engine of growth, dampens the negative impact of a decline in fertility on growth when compared with an exogenous growth model. This result stems from the rise in education levels brought about by the expectation of an increase in the discounted value of labour earnings.

Suggested Citation

  • Medeiros, João, 2000. "Endogenous Versus Exogenous Growth Facing a Fertility Shock," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2000017, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
  • Handle: RePEc:ctl:louvir:2000017
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    File URL: http://sites.uclouvain.be/econ/DP/IRES/2000-17.pdf
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    References listed on IDEAS

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    More about this item

    Keywords

    Human capital; education; fertility; endogenous growth; simulation;

    JEL classification:

    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • E27 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Forecasting and Simulation: Models and Applications
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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