Template-Type: ReDIF-Article 1.0

Author-Name: Éva Berde
Author-Workplace-Name: Corvinus University of Budapest
Author-Email: eva.berde@uni-corvinus.hu

Author-Name: Izabella Kuncz
Author-Workplace-Name: Corvinus University of Budapest
Author-Email: izabella.kuncz@uni-corvinus.hu

Title: Possible Paths for GDP Per Capita – Simulation with a Demographic Growth Model

Abstract: To begin our paper, we point out the importance of demographic growth models by
highlighting the conceptual framework of overlapping generations. We define the
formulas in our own model based on Lee – Mason (2010), modifying the original
framework in several respects. We present the exogenous fertility and survival rates
in different demographic scenarios, and then we derive the simulation paths for
GDP per capita from these. A word of caution regarding our results: the simple
structure of our model disregards several factors potentially influencing growth.
When concentrating solely on the impact of changes in fertility and mortality rates,
our simulation results suggest that a drop in the total fertility rate, even to slightly
below the replacement level, and even in the context of a relatively high survival
rate, may increase GDP per capita. However, in the case of an extremely low total
fertility rate and a high survival rate, an economic downturn can be expected.

Classification-JEL: E23, J11, O40
Keywords: overlapping generations model, total fertility rate, survival rate,
simulation path, GDP per capita
Pages: 36-57
Volume: 16
Issue: 4
Year: 2017
File-URL: http://english.hitelintezetiszemle.hu/letoltes/fer-16-4-st2-berde-kuncz.pdf
File-Format: Application/pdf
Handle: RePEc:mnb:finrev:v:16:y:2017:i:4:p:36-57