Luddites and the Demographic Transition

Kevin O'Rourke, Alan Taylor and Ahmed Rahman

No 7045, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: Technological change was unskilled-labor-biased during the early Industrial Revolution, but is skill-biased today. This is not embedded in extant unified growth models. We develop a model which can endogenously account for these facts, where factor bias reflects profit maximizing decisions by innovators. Endowments dictate that the early Industrial Revolution be unskilled-labor-biased. Increasing basic knowledge causes a growth takeoff, an income-led demand for fewer educated children, and the transition to skill-biased technological change. The simulated model tracks British industrialization in the 18th and 19th centuries and generates a demographic transition without relying on either rising skill premia or exogenous educational supply shocks.

Keywords: Demography; Endogenous growth; Unified growth theory (search for similar items in EconPapers)
JEL-codes: J13 J24 N10 O31 O33 (search for similar items in EconPapers)
Date: 2008-11
New Economics Papers: this item is included in nep-dev, nep-dge and nep-his
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (12)

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Working Paper: Luddites and the Demographic Transition (2008)
Working Paper: Luddites and the Demographic Transition (2008)
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