About: Growth Modes


There are six growth modes (graphic above) that can be generated with the Leibenstein Equation:



Where Q is Aggregate Output (GDP), N is Population, c are constants to be estimated by Principal Components Analysis (PCA) and S is the system state.


The Leibenstein Equation is a realization of the Malthusian Model. In Systems Theory, the Leibenstein Malthusian Equation is an historical controller, in this case for population growth.  The Leibenstein Malthusian Equation can be generalized in the table above to include many other possible controllers that can be emphasized within an Economic system over a particular time period. For example, (Q-P) is the Liberal Market Controller and (Q-L) is the Marxian Labor Controller. Which controller dominates over a specific historical period is a matter for statistical estimation, an important strength of the Generalized Leibenstein Equation.

This blog presents various growth modes in particular countries over specific historical periods (where data is available--for early historical periods and for complete coverage of the period 0-2000, data is only available for Leibenstein Malthusian Equation--see the Boiler Plate).

You can run the basic Leibenstein model here, the Expanded Leibenstein model here and the Leibenstein DCM Controller Model here.

References


  1.  Harvey Leibenstein (1960). Economic Backwardness and Economic Growth: Studies in the Theory of Economic Development. John Wiley & Sons.






 

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