Does Size Matter? Implications of Household Size for Economic Growth and Convergence

We assess the effects of changes in household size on the long-run evolution of living standards and on cross-country convergence. When the observed changes in average household size across countries are taken into consideration, growth in living standards is slower throughout the 20th century as compared to a measure based on per capita GDP. Furthermore, the speed of divergence between different countries be- fore 1950 is faster and the speed of convergence after 1950 is slower after adjusting for the evolution in household size.