PSY 3010 Lecture Notes - Lecture 17: Investment Goods
Document Summary
As the children of the baby boomers enter the labor force, we can look forward to another increase in the percentage of less skilled workers. Chapter 17 (page 393: rapid population growth has three effects on economic development. First, it leads to less capital per worker, which is called capital shallowing. Second, a large number of children skew a country"s production from investment goods to consumption goods. Third, rapid population growth diverts public investment from infrastructure to education and health care: most developing countries have concentrated on inward-oriented approaches because they have feared deteriorating terms of trade, protected domestic industries benefit from an import-substitution strategy.
