Beyond Balanced Growth

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
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Sergio Tavares Rebelo

Northwestern University - Kellogg School of Management ( email )

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847-467-2329 (Phone)
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Centre for Economic Policy Research (CEPR)

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National Bureau of Economic Research (NBER)

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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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