The Determinants of Subsistence Income in a Malthusian World
This study constructs a simple, two-sector Malthusian model with agriculture and industry, and uses it to identify the determinants of subsistence income. We make standard assumptions about preferences and production technology, but in contrast to existing studies we assume that children and other consumption goods are gross substitutes. Consistent with the conventional Malthusian model, the present theory shows that productivity growth in agriculture has no effect on subsistence income. More importantly, we also show that subsistence income varies, not just with the death rate as has recently been demonstrated in the literature, but also with the level of productivity in the industrial sector. An empirical analysis using data for pre-industrial England lends support to both hypotheses.
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- Quamrul Ashraf & Oded Galor, 2010.
"Dynamics and Stagnation in the Malthusian Epoch,"
Center for Development Economics
2010-07, Department of Economics, Williams College, revised May 2011.
- Quamrul Ashraf & Oded Galor, 2008. "Dynamics and Stagnation in the Malthusain Epoch: Theory and Evidence," Working Papers 2008-14, Brown University, Department of Economics.
- Quamrul Ashraf & Oded Galor, 2008. "Malthusian Population Dynamics: Theory and Evidence," Working Papers 2008-6, Brown University, Department of Economics.
- Quamrul Ashraf & Oded Galor, 2011. "Dynamics and Stagnation in the Malthusian Epoch," NBER Working Papers 17037, National Bureau of Economic Research, Inc.
- Ashraf, Quamrul & Galor, Oded, 2008. "Dynamics and Stagnation in the Malthusian Epoch: Theory and Evidence," CEPR Discussion Papers 7057, C.E.P.R. Discussion Papers.
- Quamrul Ashraf & Oded Galor, 2010. "Dynamics and Stagnation in the Malthusian Epoch," Department of Economics Working Papers 2010-01, Department of Economics, Williams College, revised May 2011.
- Holger Strulik & Jacob Weisdorf, 2008. "Population, food, and knowledge: a simple unified growth theory," Journal of Economic Growth, Springer, vol. 13(3), pages 195-216, September.
- Kevin O’rourke & Jeffrey Williamson, 2005. "From Malthus to Ohlin: Trade, Industrialisation and Distribution Since 1500," Journal of Economic Growth, Springer, vol. 10(1), pages 5-34, 01.
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