Evaluation of Sustainable Economic Growth in Portuguese Agriculture and Other Sectors - The Agricultural Economics of the 21st Century - page 99

variables that must be considered and about regional convergence or diver-
gence, and about constant returns to scale or increasing returns to scale. But
few studies try to conciliate the models of these theories with the variables
that represent sustainability at different levels (social, scientific, cultural,
etc.).
In this study an attempt has been made to analyze the compatibility
between economic growth, using the Kaldor second law equation, and some
indicators for sustainability. The results show that, as expected by Kaldor, the
sectors with more increasing returns to scale are industry and manufacturing,
but also agriculture (maybe due to the modernization of the sector with more
machinery and less labor force) and some services (namely financial and
insurance services). On the other hand, the new variables have little influence
upon economic growth for the various sectors of the Portuguese economy.
Only population density presents a negative impact upon the economic
performance of the whole economy and the agricultural sector.
These conclusions may be important indications for public institutions in
defining public policies. This is because it is often claimed, for example, that
some social policies can cause some damage towards economic growth. But
the reality is that over the last two decades in Portugal there was no relation,
considering these results, between the few social indicators considered here
(interrelated with others) and economic growth.
In future studies it will be important to find further explanation for the
conclusions presented here, namely, why economic growth in Portugal was,
more or less, over the last 20 years independent from some indicators for
sustainability. Indeed, some relation was expected between the several
dimensions of society and the economic performance in Portugal.
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