Untimely destruction: pestilence, war and accumulation in the long run

• Verfasst von: Bell, Clive [VerfasserIn]
• Verfasst von: Gersbach, Hans [VerfasserIn]
• Verfasst von: Komarov, Evgenij [VerfasserIn]
• Titel: Untimely destruction: pestilence, war and accumulation in the long run
• Verf.angabe: Clive Bell, Hans Gersbach, Evgenij Komarov
• Verlagsort: Bonn, Germany
• Verlag: IZA - Institute of Labor Economics
• E-Jahr: 2019
• Jahr: October 2019
• Umfang: 1 Online-Ressource (circa 61 Seiten)
• Illustrationen: Illustrationen
• Gesamttitel/Reihe: Discussion paper series / IZA ; no. 12680
• Datenträger: Online-Ressource
• Sprache: eng
• Sach-SW: premature mortality
• Sach-SW: capital accumulation and destruction
• Sach-SW: steady states
• Sach-SW: poverty traps
• Sach-SW: overlapping generations
• Form-SW: Graue Literatur
• K10plus-PPN: 1682056864

Abstract

This paper analyses the effects of disease and war on the accumulation of human and physical capital. We employ an overlapping-generations frame-work in which young adults, confronted with such hazards and motivated by old-age provision and altruism, make decisions about investments in schooling and reproducible capital. A poverty trap exists for a wide range of stationary war losses and premature adult mortality. If parents are altruistic and their sub-utility function for own consumption is more concave than that for the children's human capital, the only possible steady-state growth path involves full education. Otherwise, steady-state paths with incompletely educated children may exist, some of them stationary ones. We also examine, analytically and with numerical examples, a growing economy's robustness in a stochastic environment. The initial boundary conditions have a strong influence on outcomes in response to a limited sequence of destructive shocks.