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HIV/AIDS and Development: A Reappraisal of the Productivity and Factor Accumulation Effects

Author

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  • Théophile Azomahou

    (CERDI - Centre d'Études et de Recherches sur le Développement International - UCA [2017-2020] - Université Clermont Auvergne [2017-2020] - CNRS - Centre National de la Recherche Scientifique, UNU-MERIT - UNU-MERIT - United Nations University - Maastricht University)

  • Raouf Boucekkine

    (AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique)

  • Bity Diene

    (CERDI - Centre d'Études et de Recherches sur le Développement International - UCA [2017-2020] - Université Clermont Auvergne [2017-2020] - CNRS - Centre National de la Recherche Scientifique)

Abstract

We build an economico-epidemiological Solow-Swan model. Mortality and morbidity effects on effective labor are taken into account. A Ben-Porath-like mechanism affects the dynamics of the saving rate and reduces labor productivity. Based on optimal projections of the demographic and economic South African series on the period 2000-2050, we identify a delayed effect of HIV/AIDS on economic growth: the growth rate gap between the AIDS and no-AIDS scenarios is rather stable between 2010 and 2020, but then it increases sharply between 2020 and 2030, keeps increasing at a much lower pace between 2030 and 2040, and finally stabilizes after 2040. The fall in active population is the main factor behind AIDS impact on economic growth during the decade 2020-2030 while the Ben-Porath mechanism on labor productivity is more relevant in the last decade. Physical capital accumulation plays a minor role.

Suggested Citation

  • Théophile Azomahou & Raouf Boucekkine & Bity Diene, 2016. "HIV/AIDS and Development: A Reappraisal of the Productivity and Factor Accumulation Effects," Post-Print hal-01687446, HAL.
    • Handle: RePEc:hal:journl:hal-01687446
    DOI: 10.1257/aer.p20161112
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    References listed on IDEAS

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    1. Raouf Boucekkine & David de la Croix & Omar Licandro, 2003. "Early Mortality Declines at the Dawn of Modern Growth," Scandinavian Journal of Economics, Wiley Blackwell, vol. 105(3), pages 401-418, September.
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    5. Boucekkine, Raouf & de la Croix, David & Licandro, Omar, 2002. "Vintage Human Capital, Demographic Trends, and Endogenous Growth," Journal of Economic Theory, Elsevier, vol. 104(2), pages 340-375, June.
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    8. Raouf Boucekkine & Bity Diene & Theophile Azomahou, 2008. "Growth Economics of Epidemics: A Review of the Theory," Mathematical Population Studies, Taylor & Francis Journals, vol. 15(1), pages 1-26.
    9. Blanchard, Olivier J, 1985. "Debt, Deficits, and Finite Horizons," Journal of Political Economy, University of Chicago Press, vol. 93(2), pages 223-247, April.
    10. Yoram Ben-Porath, 1967. "The Production of Human Capital and the Life Cycle of Earnings," Journal of Political Economy, University of Chicago Press, vol. 75, pages 352-352.
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    Cited by:

    1. 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.
    2. d’Albis, Hippolyte & Augeraud-Véron, Emmanuelle, 2021. "Optimal prevention and elimination of infectious diseases," Journal of Mathematical Economics, Elsevier, vol. 93(C).
    3. Luca Gori & Cristiana Mammana & Piero Manfredi & Elisabetta Michetti, 2022. "Economic development with deadly communicable diseases and public prevention," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 24(5), pages 912-943, October.
    4. David E. Bloom & Michael Kuhn & Klaus Prettner, 2022. "Modern Infectious Diseases: Macroeconomic Impacts and Policy Responses," Journal of Economic Literature, American Economic Association, vol. 60(1), pages 85-131, March.
    5. Peter A.G. van Bergeijk, 2021. "Pandemic Economics," Books, Edward Elgar Publishing, number 20401.
    6. Aditya Goenka & Lin Liu, 2020. "Infectious diseases, human capital and economic growth," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 70(1), pages 1-47, July.
    7. Ian M. Trotter & Lu'is A. C. Schmidt & Bruno C. M. Pinto & Andrezza L. Batista & J'essica Pellenz & Maritza Isidro & Aline Rodrigues & Attawan G. S. Suela & Loredany Rodrigues, 2020. "COVID-19 and Global Economic Growth: Policy Simulations with a Pandemic-Enabled Neoclassical Growth Model," Papers 2005.13722, arXiv.org, revised Jun 2020.
    8. Bloom, David E. & Kuhn, Michael & Prettner, Klaus, 2017. "Africa'S Prospects For Enjoying A Demographic Dividend," Journal of Demographic Economics, Cambridge University Press, vol. 83(1), pages 63-76, March.
    9. Bloom, David E. & Kuhn, Michael & Prettner, Klaus, 2018. "Health and Economic Growth," IZA Discussion Papers 11939, Institute of Labor Economics (IZA).
    10. Azomahou, Théophile T. & Ndung’u, Njuguna & Ouédraogo, Mahamady, 2021. "Coping with a dual shock: The economic effects of COVID-19 and oil price crises on African economies," Resources Policy, Elsevier, vol. 72(C).
    11. Wang, Lucy Xiaolu, 2022. "Global drug diffusion and innovation with the medicines patent pool," Journal of Health Economics, Elsevier, vol. 85(C).
    12. Raouf Boucekkine & Shankha Chakraborty & Aditya Goenka & Lin Liu, 2024. "A Brief Tour of Economic Epidemiology Modelling," LIDAM Discussion Papers IRES 2024002, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    13. Théophile T Azomahou & Njuguna Ndung'U & Mahamady Ouedraogo, 2021. "Coping with a dual shock : the economic effects of COVID-19 and oil price crises on African economies," Post-Print hal-03344118, HAL.
    14. David E. BLOOM & Michael KUHN & Klaus PRETTNER, 2017. "Africa’s Prospects for Enjoying a Demographic Dividend," JODE - Journal of Demographic Economics, Cambridge University Press, vol. 83(1), pages 63-76, March.

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    More about this item

    JEL classification:

    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • I15 - Health, Education, and Welfare - - Health - - - Health and Economic Development
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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