Balanced growth revisited : a two-sector model of economic growth

DSpace/Manakin Repository

Show simple item record

dc.contributor.author Whelan, Karl
dc.date.accessioned 2008-06-13T16:08:29Z
dc.date.available 2008-06-13T16:08:29Z
dc.date.issued 2000-12-05
dc.identifier.uri http://hdl.handle.net/10197/247
dc.description.abstract The one-sector Solow-Ramsey model is the most popular model of long-run economic growth. This paper argues that a two-sector approach, which distinguishes the durable goods sector from the rest of the economy, provides a far better picture of the long-run behavior of the U.S. economy. Real durable goods output has consistently grown faster than the rest of the economy. Because most investment spending is on durable goods, the one-sector model's hypothesis of balanced growth, so that the real aggregates for consumption, investment, output, and the capital stock all grow at the same rate in the long run, is rejected by U.S. data. In addition, to model these aggregates as currently constructed in the U.S. National Accounts, a two-sector approach is required. Implications for empirical macroeconomics are explored. en
dc.format.extent 4304 bytes
dc.format.mimetype application/pdf
dc.language.iso en en
dc.publisher Federal Reserve en
dc.relation.ispartofseries Finance and Economics Discussion Series en
dc.relation.ispartofseries No. 01-04 en
dc.subject Balanced growth en
dc.subject Multisector models en
dc.subject Chain aggregation en
dc.subject.classification O41 en
dc.subject.classification O47 en
dc.subject.lcsh Economic development--United States en
dc.subject.lcsh Economic development--Mathematical models en
dc.subject.lcsh Durable goods, Consumer en
dc.title Balanced growth revisited : a two-sector model of economic growth en
dc.title.alternative A two-Sector approach to modeling U.S. NIPA data
dc.type Working Paper en
dc.internal.authorurl Karl Whelan (web page) en
dc.internal.authorurl http://www.karlwhelan.com/ en
dc.internal.authorcontactother Email: karl.whelan@ucd.ie; Tel: 353 1 716 8239 en
dc.internal.authorid UCD0026 en
dc.internal.availability Full text available en
dc.internal.webversions Online Provider's version en
dc.internal.webversions http://dx.doi.org/10.2139/ssrn.258372 en
dc.internal.webversions Publisher's version
dc.internal.webversions http://www.federalreserve.gov/pubs/feds/2001/200104/200104pap.pdf
dc.status Not peer reviewed en
dc.identifier.doi 10.2139/ssrn.258372
dc.neeo.contributor Whelan|Karl|aut|UCD0026


Files in this item

This item appears in the following Collection(s)

Show simple item record

This item is available under the Attribution-NonCommercial-NoDerivs 3.0 Ireland. No item may be reproduced for commercial purposes. For other possible restrictions on use please refer to the publisher's URL where this is made available, or to notes contained in the item itself. Other terms may apply.

If you are a publisher or author and have copyright concerns for any item, please email research.repository@ucd.ie and the item will be withdrawn immediately. The author or person responsible for depositing the article will be contacted within one business day.

Search Research Repository


Advanced Search

Browse