A MODIFIED NEOCLASSICAL GROWTH MODEL WITH ENDOGENOUS LABOR PARTICIPATION

Delano Villanueva

Bulletin of Monetary Economics and Banking, 2020, vol. 23, issue 1, 83-100

Abstract: In light of robust econometric results on the determinants of labor participation in 36 advanced economies reported by Grigoli et al. (2018) and independently by CBO (2018), my paper modifies the Solow (1956) - Swan (1956), or S-S, growth model by making endogenous the rate of labor participation (exogenously fixed at a constant fraction of population in the S-S model). By allowing a fully adjusting natural rate, I find that the positive growth effects of a higher saving rate hold in the transition to and in the steady state (a generalization of the S-S model).

Keywords: Neoclassical Growth; Technical Change; Labor Participation; Growth Policies (search for similar items in EconPapers)
JEL-codes: E13 J22 O41 (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:idn:journl:v:23:y:2020:i1d:p:83-100

DOI: 10.21098/bemp.v23i1.1175

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