A two-sector economic growth model with endogenous labor shift and endogenous growth cycles

摘要

In this paper, a two-sector growth model with endogenous labor shift and endogenous growth cycles is given. Due to the wage difference, there is a flow of labor force from the sector with low wage rate to high wage rate. When the labor shift responds rapidly to the wage rate difference, the economy growth reveals cyclical fluctuations with contraction and the amplitude of fluctuations decays gradually as the economy develops. The economy grows smoothly without cyclical fluctuations when the labor shift responds slightly to the wage rate difference.