Using the Solow Growth Model. The Impact of Endemic Diseases on Economic Growth

Julio Carmona

No 24-1, QM&ET Working Papers from University of Alicante, D. Quantitative Methods and Economic Theory

Abstract: The recent sad news about the Robert Solow’s decease has motivated a review of his most celebrated contribution to Economics, his model of economic growth. In this paper, I illustrate its versatility and usefulness by combining it with the problem that endemic diseases has for the economic performance of most emerging economies. The literature about economic development have examined this problem with particular emphasis on the necessary sanitary measures to raise the level of health. These measures have been advocated on the basis that they will have big positive effects on productivity, real wages and per capita GDP. To illustrate to our undergraduate students both, the value of health for economic development and the intuitions the Solow model can provide, I couple it with the so called SIS model, a concise description of persistent diseases. This will help to illustrate how endemic diseases affect negatively society’s welfare and, for the case in which the endemic disease increases the mortality rate, the rate of economic growth.

Keywords: SIS Model; Solow Model; Poverty Trap (search for similar items in EconPapers)
JEL-codes: E00 I15 O40 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2024-02-05
New Economics Papers: this item is included in nep-gro and nep-hea
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Persistent link: https://EconPapers.repec.org/RePEc:ris:qmetal:2024_001

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