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Structural change with different consumption profiles in a pure labour economy

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  • Costa, Leopoldo
  • Teixeira, Joanilio Rodolpho

Abstract

Our purpose is to extend the pure labour model in order to deal with different consumption profiles. The condition of effective demand is different from that obtained by Pasinetti (1981, 1993) because now it depends on the family types. In addition, the inclusion of different consumption profiles, and their own dynamics, makes the task of pursuing full employment more challenging. Families face different inflation rates, even with stability of prices. In this vein, the necessity of the Central Bank to pursue stability of general price level is formally approached. The Central Bank intervention is also justified by the influence of different consumption profiles on the rate of interest and on the inter-temporal distribution of income. Our analysis shows some consequences and complexities of a preliminary institutional approach.

Suggested Citation

  • Costa, Leopoldo & Teixeira, Joanilio Rodolpho, 2018. "Structural change with different consumption profiles in a pure labour economy," Structural Change and Economic Dynamics, Elsevier, vol. 47(C), pages 28-34.
    • Handle: RePEc:eee:streco:v:47:y:2018:i:c:p:28-34
    DOI: 10.1016/j.strueco.2018.06.002
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    Cited by:

    1. Yu, Jian & Shi, Xunpeng & Cheong, Tsun Se, 2021. "Distribution dynamics of China's household consumption upgrading," Structural Change and Economic Dynamics, Elsevier, vol. 58(C), pages 193-203.

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    More about this item

    Keywords

    Structural change; Pure labour model; Consumption profile;
    All these keywords.

    JEL classification:

    • D1 - Microeconomics - - Household Behavior
    • E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
    • E4 - Macroeconomics and Monetary Economics - - Money and Interest Rates
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development

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