Campus Units

Economics

Document Type

Article

Publication Version

Published Version

Publication Date

2004

Journal or Book Title

Economics Bulletin

Volume

15

Issue

8

First Page or Article ID Number

1

Last Page

8

Abstract

Chakraborty [Journal of Economic Theory, 2004] introduces endogenous mortality in a two period overlapping generations model by postulating that the probability of surviving from the first period to the second depends on tax−funded public health. His central result on the existence of multiple steady states (including development traps) summarized in Proposition 1 is incorrect. This paper presents the correct proposition and its proof, and in the process, uncovers several new, interesting results. Contrary to Chakraborty's analysis, high mortality yet high capital nations may not be able to escape the poverty trap. Interestingly, TFP growth can help economies escape the vicious cycle of poverty.

Comments

This is an article from Economics Bulletin 15 (2004): 1. Posted with permission.

Copyright Owner

Economics Bulletin

Language

en

File Format

application/pdf

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