Cumulative Causation in a Structural Economic Dynamic Approach to Economic Growth and Uneven Development
Ricardo Araujo ()
MPRA Paper from University Library of Munich, Germany
The Structural Economic Dynamic approach is distinguished by its simultaneous approach to demand and supply sides of economic growth. However, the idea that growth itself can transform an economy, which became known in the literature as cumulative causation, cannot be properly studied by this framework because technological progress is treated in the same manner as in the traditional Neoclassical model, that is, it is exogenous. Besides, it is the only source of economy growth with no role played by demand in the pace of economic growth but only in the sectoral composition of the economy. Here we introduce Verdoon’s Law in the Pasinetti’s model of structural change thus making it able to study cumulative causation and thus rendering structural changes endogenous in this model.
Keywords: Cumulative causation; structural change; Verdoon’s law (search for similar items in EconPapers)
JEL-codes: O41 O33 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-dev and nep-fdg
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Journal Article: Cumulative causation in a structural economic dynamic approach to economic growth and uneven development (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:29960
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