Ngai, L. Rachel and Pissarides, Christopher (2004) Balanced growth with structural change. CEP discussion paper (CEPDP0627). London School of Economics and Political Science. Centre for Economic Performance, London, UK.
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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) |
|---|---|
| Official URL: | https://cep.lse.ac.uk/_new/publications/ |
| Additional Information: | © 2004 L. Rachel Ngai and Christopher A. Pissarides |
| Divisions: | Centre for Economic Performance Economics |
| 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: | 06 May 2008 15:44 |
| Last Modified: | 15 Sep 2023 22:59 |
| URI: | http://eprints.lse.ac.uk/id/eprint/4658 |
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