A Malthus-Swan-Solow model of economic growth

Abstract

In this paper we introduce in the Solow-Swan growth model a labor supply based on Malthusian ideas. We show that this model may yield several steady states and that an increase in total factor productivity might decrease the capital-labor ratio in a stable equilibrium. "Why has it taken economists so long to learn that demography influences growth?" Jeff Williamson (1998)[13] 2010 Mathematics Subject Classification. 37N40.

How does population growth affect economic growth and vice versa? An empirical analysis

“…Other theoretical approaches adopt the classic’s approach of considering population as an endogenously determined variable. Hansen and Prescott (2002), Irmen (2004), Mierau and Turnovsky (2014), Corchón (2016), and more recently, Bucci et al. (2019), among others, have developed models in which the relation between population growth and economic growth is nonmonotonic, with effects that vary in size, sign and direction.…”

The Solow-Swan model with endogenous population growth

“…Finally, Corchón [13] reformulates the Solow model under a Malthusian approach, where the population growth rate is a growing function of real wages. With this specification, the model shows the possibility of multiple equilibria, depending on the population dynamics.…”

“…With this specification, the model shows the possibility of multiple equilibria, depending on the population dynamics. In our article, the procedure used by Corchón [13] is followed, with two differences. On the one hand, we generalize the production function.…”

“…On the other hand, a positive population growth is assumed, where for a range of per capita consumption levels, it grows at an increasing rate, reflecting the Malthusian ideas regarding population dynamics and economic growth. It should be noted that making population growth depend on per capita consumption or real wages (as Corchón [13] does) is equivalent. Due to the properties assumed from the production function.…”

“…In the context where dynamic growth models, such as the Solow-Swan or Ramsey-Cass-Koopmans models, were developed, this assumption seems to be credible (see Figure 1). However, in our model (following Corchón [13]), population dynamics emerge from the Malthus trap, and we seek to reflect the evolution of the world population from a historical perspective, reflecting the dynamics of the last two centuries. The population evolution was not exponential.…”