Structural Change and the Kaldor Facts of Economic Growth

Reto Foellmi () and Josef Zweimüller ()

No 3300, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: We present a model in which two of the most important features of the long-run growth process are reconciled: the massive changes in the structure of production and employment; and the Kaldor facts of economic growth. We assume that households expand their consumption along a hierarchy of needs and firms continuously introduce new products. In equilibrium industries with an expanding and those with a declining employment share co-exist, and each such industry goes (or has already gone) through a cycle of take-off, maturity, and stagnation. Nonetheless macroeconomic aggregates grow pari passu at a constant rate.

Keywords: balanced growth; demand externalities; hierarchic preferences; innovation; Kaldor facts; multiple equilibria; structural change (search for similar items in EconPapers)
JEL-codes: D91 L16 O11 O31 O40 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-dev and nep-pke
Date: 2002-04
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Related works:
Working Paper: Structural Change and the Kaldor Facts of Economic Growth (2002)
Working Paper: Structural Change and the Kaldor Facts of Economic Growth
Working Paper: Structural Change and the Kaldor Facts of Economic Growth (2006)
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