Malthus was right: Explaining a millennium of stagnation

Abstract

We develop a simple Malthusian growth model with continuous productivity growth and derive the stationary steady-state equilibrium. We show that linearisation around the steady-state gives an empirically tractable model of Malthusian wage and population behaviour using the familiar concept of β-convergence. Our empirical strategy addresses the concern in the literature over model identification and inconsistent parameter estimates. Based on newly constructed population data, we estimate wage and population growth models using panel data for up to 17 countries from 900CE to 1870CE. Our results provide the first time-series evidence of a strong Malthusian trap that was pervasive across countries and time before the 19th century industrial revolution.