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Beyond Balanced Growth

IMF Working Paper No. 01/85

21 Pages Posted: 31 Jan 2006

See all articles by Piyabha P. Kongsamut

Piyabha P. Kongsamut

University of Rochester - Department of Economics

Sergio T. Rebelo

Northwestern University - Kellogg School of Management; Centre for Economic Policy Research (CEPR); National Bureau of Economic Research (NBER)

Danyang Xie

Hong Kong University of Science & Technology (HKUST) - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: June 2001

Abstract

Balanced growth models are commonly used in macroeconomics because they are consistent with the well-known Kaldor facts regarding economic growth. These models, however, are inconsistent with one of the most striking regularities of the growth process - the massive reallocation of labor from agriculture into manufacturing and services. This paper presents a simple model consistent with both the Kaldor facts and the dynamics of sectoral labor reallocation. The model shows that balanced growth can be consistent with structural change.

Keywords: growth, structural change, Kaldor facts

JEL Classification: 014, 041

Suggested Citation

Kongsamut, Piyabha P. and Tavares Rebelo, Sergio and Xie, Danyang, Beyond Balanced Growth (June 2001). IMF Working Paper No. 01/85, Available at SSRN: https://ssrn.com/abstract=879617

Piyabha P. Kongsamut (Contact Author)

University of Rochester - Department of Economics ( email )

Harkness Hall
Rochester, NY 14627-0158
United States
301-770-3789 (Phone)

Sergio Tavares Rebelo

Northwestern University - Kellogg School of Management ( email )

2001 Sheridan Road
Leverone Hall
Evanston, IL 60208
United States
847-467-2329 (Phone)
847-491-5719 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Danyang Xie

Hong Kong University of Science & Technology (HKUST) - Department of Economics ( email )

Clear Water Bay
Kowloon, Hong Kong
China
852-2358-7603 (Phone)
852-2358-2084 (Fax)

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