Ngai, L. Rachel and Pissarides, Christopher (2004) Balanced growth with structural change. CEP discussion paper; CEPDP0627, Centre for Economic Performance, London School of Economics and Political Science, London. (Unpublished)
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Abstract
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 labor 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 reaonsable deviations from our conditions do not have a big impact on the properties of the model.
| Item Type: | Monograph (Working Paper) |
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| Additional Information: | © 2004 L. Rachel Ngai and Christopher A. Pissarides |
| Library of Congress subject classification: | H Social Sciences > HB Economic Theory |
| Journal of Economic Literature Classification System: | 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 |
| Sets: | Collections > Economists Online Research centres and groups > Centre for Economic Performance (CEP) Departments > Economics |
| Date Deposited: | 06 May 2008 15:44 |
| URL: | http://eprints.lse.ac.uk/4658/ |
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