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Structural change in a multi-sector model of growth

Ngai, L. Rachel and Pissarides, Christopher (2004) Structural change in a multi-sector model of growth. In: Democracy, Sustainability and Policy Reform, 2004-11-15, Prague, Czech Republic. (Submitted)

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Identification Number: 627


We study a multi-sector model of growth with differences in TFP growth rates across sectors and derive sufficient conditions for the coexistence of structural change, characterized by sectoral labour reallocation, and constant aggregate growth path. The conditions are weak restrictions on the utility and production functions commonly applied by macroeconomists. We present evidence from US two-digit industries that is consistent with our predictions about structural change and successfully calibrate the historical shift from agriculture to manufacturing and services. We show quantitatively that reasonable deviations from our conditions do not have a big impact on the properties of the model.

Item Type: Conference or Workshop Item (Paper)
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Additional Information: © 2004 L. Rachel Ngai and Christopher Pissarides
Divisions: Centre for Economic Performance
Subjects: H Social Sciences > HB Economic Theory
JEL classification: O - Economic Development, Technological Change, and Growth > O1 - Economic Development > O14 - Industrialization; Manufacturing and Service Industries; Choice of Technology
O - Economic Development, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O41 - One, Two, and Multisector Growth Models
Date Deposited: 21 Apr 2008 10:17
Last Modified: 07 Nov 2021 00:08

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