Transition dynamics in the neoclassical growth model: the case of South Korea
Yongsung Chang () and
No 11-04, Working Paper from Federal Reserve Bank of Richmond
Many cases of successful economic development, such as South Korea, exhibit long periods of sustained capital accumulation rates. This empirical feature is at odds with the standard neoclassical growth model which predicts initially high and then declining capital accumulation rates. We show that minor modifications of the neoclassical model go a long way towards accounting for the transition dynamics of the South Korean economy. Our modifications recognize that (1) agriculture essentially does not use reproducible capital, and that during the transition period (2) the relative price of capital declines substantially, and (3) the nonfarm employment share increases substantially.
Keywords: Economic growth; Business cycles; Economic development (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-dge, nep-fdg and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed
Downloads: (external link)
http://www.richmondfed.org/publications/research/w ... rs/2011/wp_11-04.cfm (text/html)
http://www.richmondfed.org/publications/research/w ... 2011/pdf/wp11-04.pdf (application/pdf)
Journal Article: Transition dynamics in the neoclassical growth model: the case of South Korea (2015)
Working Paper: Transition Dynamics in the Neoclassical Growth Model: The Case of South Korea (2011)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:fip:fedrwp:11-04
Ordering information: This working paper can be ordered from
Access Statistics for this paper
More papers in Working Paper from Federal Reserve Bank of Richmond Contact information at EDIRC.
Bibliographic data for series maintained by Christian Pascasio ().