Growth and Structural Transformation

Berthold Herrendorf, Richard Rogerson, Ákos Valentinyi

Research output: Contribution to journalArticle

140 Citations (Scopus)

Abstract

Structural transformation refers to the reallocation of economic activity across the broad sectors agriculture, manufacturing, and services. This review article synthesizes and evaluates recent advances in the research on structural transformation. We begin by presenting the stylized facts of structural transformation across time and space. We then develop a multi-sector extension of the one-sector growth model that encompasses the main existing theories of structural transformation. We argue that this multi-sector model serves as a natural benchmark to study structural transformation and that it is able to account for many salient features of structural transformation. We also argue that this multi-sector model delivers new and sharper insights for understanding economic development, regional income convergence, aggregate productivity trends, hours worked, business cycles, wage inequality, and greenhouse gas emissions. We conclude by suggesting several directions for future research on structural transformation.

Original languageEnglish (US)
Pages (from-to)855-941
Number of pages87
JournalHandbook of Economic Growth
Volume2
DOIs
StatePublished - 2014

Fingerprint

Structural transformation
Multi-sector models
Regional economic development
Economic activity
Benchmark
Growth model
Agriculture
Aggregate productivity
Wage inequality
Stylized facts
Reallocation
Greenhouse gas emissions
Manufacturing
Income convergence
Business cycles
Hours worked

Keywords

  • Approximate balanced growth
  • Multi-sector growth model
  • Structural transformation
  • Stylized facts

ASJC Scopus subject areas

  • Economics and Econometrics

Cite this

Growth and Structural Transformation. / Herrendorf, Berthold; Rogerson, Richard; Valentinyi, Ákos.

In: Handbook of Economic Growth, Vol. 2, 2014, p. 855-941.

Research output: Contribution to journalArticle

Herrendorf, Berthold ; Rogerson, Richard ; Valentinyi, Ákos. / Growth and Structural Transformation. In: Handbook of Economic Growth. 2014 ; Vol. 2. pp. 855-941.
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