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Conformism and Structural Change

Author

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  • Takeo Hori

    (Aoyamagakuin University)

  • Masako Ikefuji

    (University of Southern Denmark)

  • Kazuo Mino

    (Kyoto University)

Abstract

We study structural change in a simple, two-sector endogenous growth model and show that the presence of commodity-specific consumption externalities can be a source of structural change. When the degrees of consumption externalities are different between different goods, the two sectors grow at different rates, whereas the aggregate economy exhibits balanced growth in the sense that capital stock and expenditure grow at the same constant rate. Under the more restrictive condition such that the degrees of consumption externalities are the same, structural change does not occur. We also show that the dependence of the benchmark consumption levels on the past consumption is crucial for the divergent patterns of structural change across countries.

Suggested Citation

  • Takeo Hori & Masako Ikefuji & Kazuo Mino, 2012. "Conformism and Structural Change," KIER Working Papers 825, Kyoto University, Institute of Economic Research.
    • Handle: RePEc:kyo:wpaper:825
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    Cited by:

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    3. Alireza Shakibaei & MohammadReza Ahmadinejad, 2016. "Investigating the Structural Changes of Tax in Iran," Iranian Economic Review (IER), Faculty of Economics,University of Tehran.Tehran,Iran, vol. 20(4), pages 445-460, Autumn.

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    More about this item

    Keywords

    Structural change; Consumption externalities; Two-sector growth model; Kaldor facts;
    All these keywords.

    JEL classification:

    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • E30 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - General (includes Measurement and Data)
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

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