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on Demographic Economics |
| By: | Thomas Baudin (Max Planck Institute for Demographic Research, Rostock, Germany); Robert Stelter (Max Planck Institute for Demographic Research, Rostock, Germany) |
| Abstract: | To assess the importance of the rural exodus in fostering the transition from stagnation to growth, we propose a unified model of growth and internal migrations. Using an original set of Swedish data, we identify the deep parameters of our model. We show that internal migration conditions had to be favorable enough to authorize an exodus out of the countryside in order to fuel the industrial development of cities and the demographic transition of the country. We then compare the respective contribution of shocks on internal migration costs, infant mortality and inequalities in agricultural productivity to the economic take-off and the demographic transition that occurred in Sweden. Negative shocks on labor mobility generate larger delays in the take-off to growth compared to mortality shocks equivalent to the Black Death. Deepening inequalities of productivity in the agricultural sector, like it has been done by enclosure movements, contributes to accelerate urbanization at the cost of depressed economic growth. |
| Keywords: | Europe, Sweden |
| JEL: | J1 Z0 |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:dem:wpaper:wp-2019-005&r=all |
| By: | Benoit Mojon; Xavier Ragot |
| Abstract: | Why is wage inflation so weak in spite of the recent sharp reduction in unemployment? We show that this may be due to an ongoing change in the composition of the labor supply. Indeed, the participation rate of workers aged between 55 and 64 has increased steadily over the last decade, from a third to above a half on average across OECD countries. This is most likely the consequence of ageing and the reform of pensions. We show that the participation rate of workers aged 55 to 64 contributes to explain why wage inflation has remained weak over the last five years. Our second result is that Phillips curves are alive and well. When exploiting the cross-country variance of the data, wage inflation remains highly responsive to domestic unemployment rates, including after the Great Recession. |
| Keywords: | low inflation, ageing economy, Phillips curve |
| JEL: | E5 J3 |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:bis:biswps:776&r=all |