A Basic Model of Take-Off and Fertility Choices in the Economic Development Process

We present a simple model in which the transition from Malthusian stagnation to modern growth can occur. Agents are endowed with full control over their fertility but, differently from other studies, the degree of agents' altruism which mainly affects fertility choices are allowed to change with the standard of living. We relate agents' altruism to the marginal utility of consumption. By using a microeconomic framework where the marginal utility of consumption increases at low levels of consumption, we discuss how the model generates the take-off, and we analyze the properties of its balanced growth path. Our model also provides for a potential explanation to the J-shaped relationship between natality rates and standard of living found by recent empirical studies