A note on demographic shocks in a multi-sector growth model

Authors

Simone Marsiglio, University of WollongongFollow
Davide La Torre, Universita degli Studi di Milano

RIS ID

97960

Publication Details

Marsiglio, S. & La Torre, D. (2012). A note on demographic shocks in a multi-sector growth model. Economics Bulletin, 32 (3), 2293-2299.

Abstract

We introduce demographic shocks in a multi-sector endogenous growth model, a-la Uzawa-Lucas. We show that an analytical solution of the stochastic problem can be found, under the restriction that the capital share equals both the inverse of the intertemporal elasticity of substitution and the degree of altruism. We show that uncertainty lowers the optimal levels of consumption and the physical capital stock, while they do not affect the share of human capital employed in production.