Article
Credit constraints and structure: a theoretical model of extractivism and slow-growth dynamics
Brazilian Journal of Political Economy
(2021)
Abstract
We develop a theoretical model that explains the relationship between credit constraints and economic growth in the context of a three-sector economy, including an “extractive” sector. The model belongs in the structuralist tradition and it is inspired by the Colombian economy. In contrast to neoclassic development economics models, we prove that: 1) relaxing the credit crunch would foster formal sector growth but it may nevertheless not imply formal employment growth; and 2) the economy can converge to a pattern where the extractive sector increases while the formal one shrinks.
Keywords
- Credit constraints,
- Formal Employment,
- Extractivism,
- Colombia,
- Structural Economics
Disciplines
Publication Date
Summer 2021
DOI
10.1590/0101-31572021-3122
Citation Information
Nestor Garza. "Credit constraints and structure: a theoretical model of extractivism and slow-growth dynamics" Brazilian Journal of Political Economy (2021) Available at: http://works.bepress.com/nestor-garza/27/