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Dilution effects, population growth and economic growth under human capital accumulation and endogenous technological change

Dilution effects, population growth and economic growth under human capital accumulation and endogenous technological change
Autor:

Bucci, A., Eraydin, L., Müller, M. 

Links:
Quelle:

Journal of Macroeconomics, 2018

Datum: August 2018

Abstract

This paper answers the following two questions: (1) In the data, do we find a dilution effect of population growth also on per-capita human capital investment? If yes, (2) How can we use this observation to explain theoretically the existence of a differential impact of population change on economic growth across countries? In the first part of the article we document empirically considerable cross-country heterogeneity of a dilution effect of population growth with regards to the process of per-capita human capital formation. And we observe that, depending on the dilution effect observed in a given country, population growth may be relevant — either positively or negatively — for economic growth. In the second part of the paper we use these results to build a multi-sector growth model which, by allowing for a country specific dilution effect of population growth on per-capita human capital formation, is capable of accounting for the non-monotonous correlation between demographic and economic growth rates in the long-run.