On Demographic Transition, Structural Change, and Economic Growth and Stagnation
Holger Strulik ()
Quantitative Macroeconomics Working Papers from Hamburg University, Department of Economics
The paper analyzes an economy with an agrarian and an industrial sector. Demand is determined by Engel's Law. Population growth follows a non--linear income dependent path according to the theory of demographic transition. In case of decreasing returns to scale in the agrarian sector the existence of a stable low--income equilibrium with high population growth can be shown. If this equilibrium is globally unstable, the system evolves towards a steady--state of perpetual economic growth and low population growth. The path of demographic transition coincides with a path of structural change from an economy specialized in agriculture to a fully industrialized economy. The introduction of an income dependent savings rate allows the interpretation of the low--income equilibrium as a limit cycle and, therefore, the explanation of high fluctuations in population growth and per capita income in least developed economies.
Keywords: Demographic Transition; Economic Growth; Structural Change; Limit Cycles (search for similar items in EconPapers)
JEL-codes: J10 J13 O11 O12 (search for similar items in EconPapers)
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Journal Article: On demographic transition, structural change, and economic growth and stagnation (2000)
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Persistent link: https://EconPapers.repec.org/RePEc:ham:qmwops:19803
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