The rise of services and balanced growth in theory and data
Miguel Leon-Ledesma () and
LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library
When measured using NIPA conventions, a two-sector model of balanced growth and structural transformation can account for the mildly declining GDP growth rate, increasing share of services, and increasing real investment/GDP ratio observed in the post-war U.S. economy. These changes induce a decline of 36% in the marginal product of capital and of 5.4% in the real interest rate. By retaining the U.S. calibration, the process of structural transformation can also account, per-se, for cross-country differences in real investment/GDP ratios, which are comparable to those displayed by the U.S. along its growth path.
Keywords: Structural transformation; productivity of capital; two-sector model. (search for similar items in EconPapers)
JEL-codes: E22 E24 E31 O41 (search for similar items in EconPapers)
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Working Paper: The Rise of Services and Balanced Growth in Theory and Data (2018)
Working Paper: The Rise of Services and Balanced Growth in Theory and Data (2017)
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