Excerpt

Structural Transformations with Long-Run Price and Income Effects. Diego Comin, February 10, 2015, Paper. "We present a multi-sector model of growth that accommodates long-run real income effects and sectoral price trends. Consistent with post-war data from OECD countries, our model generates constant aggregate growth rates, constant interest rates and non-constant sectoral expenditure shares (non-homothetic Engel curves). Our model is consistent with the decline in agriculture, the hump-shaped evolution of manufacturing and the rise of services both in nominal and real terms. We estimate the demand system derived from the model..." Link