Structural change in a multi-sector model of growth

L. Rachel Ngai and Christopher Pissarides

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: We study a multisector model of growth with differences in TFP growth rates across sectors and derive sufficient conditions for the coexistence of structural change, characterized by sectoral labor reallocation and balanced aggregate growth. The conditions are weak restrictions on the utility and production functions. Along the balanced growth path, labor employed in the production of consumption goods gradually moves to the sector with the lowest TFP growth rate, until in the limit it is the only sector with nontrivial employment of this kind. The employment shares of intermediate and capital goods remain constant during the reallocation process.

Keywords: multi-sector growth; sectoral employment; structural change and unbalanced growth (search for similar items in EconPapers)
JEL-codes: O14 O41 (search for similar items in EconPapers)
Pages: 15 pages
Date: 2007-03-01
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (161)

Published in American Economic Review, 1, March, 2007, 97(1), pp. 429 - 443. ISSN: 0002-8282

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http://eprints.lse.ac.uk/4468/ Open access version. (application/pdf)

Related works:
Journal Article: Structural Change in a Multisector Model of Growth (2007)
Working Paper: Structural change in a multi-sector model of growth (2005)
Working Paper: Structural Change in a Multi-Sector Model of Growth (2005)
Working Paper: Structural Change in a Multi-Sector Model of Growth (2004)
Working Paper: Structural change in a multi-sector model of growth (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:4468

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