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DEMOGRAPHY AND GROWTH: A UNIFIED TREATMENT OF OVERLAPPING GENERATIONS

Published online by Cambridge University Press:  28 September 2012

Neil Bruce  and
Stephen J. Turnovsky
Neil Bruce*
Affiliation:
University of Washington
Stephen J. Turnovsky
Affiliation:
University of Washington
*
Address correspondence to: Neil Bruce, Department of Economics, Campus Box 353330, University of Washington, Seattle, WA 98195–3330, USA; e-mail: brucen@u.washington.edu.
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Abstract

We construct a unified overlapping-generations framework of equilibrium growth that includes the Blanchard “perpetual youth” model, the Samuelson model, and the infinitely lived–agent model as limit specifications for a “realistic” two-parameter survivorship function. We assess how the limit specifications compare with the general survival function, and analyze how exogenous changes in demographic conditions affect equilibrium growth and savings rates. Predicted effects are consistent with some cross-country correlations between demographic conditions and growth rates.

Keywords

DemographyGrowthOverlapping Generations
Type
Articles
Information
Macroeconomic Dynamics , Volume 17 , Issue 8 , December 2013 , pp. 1605 - 1637
Copyright
Copyright © Cambridge University Press 2012 

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