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on Economic Growth |
| By: | Marti Mestieri (Toulouse School of Economics); Danial Lashkari (Harvard University); Diego Comin (Harvard Business School) |
| Abstract: | 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 --which takes a simple log-linear form-- using historical data on sectoral shares from 30 different countries and household survey data. We show that our model parsimoniously accounts for the broad patterns of sectoral reallocation observed among rich, miracle and developing economies in the post-war period. |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:red:sed015:437&r=all |
| By: | Yann Algan (ECON - Département d'économie - Sciences Po); Pierre Cahuc (ECON - Département d'économie - Sciences Po) |
| Abstract: | This survey reviews the recent research on trust, institutions, and economic development. It discusses the various measures of trust and documents the substantial heterogeneity of trust across space and time. The conceptual mechanisms that explain the influence of trust on economic performance and the methods employed to identify the causal impact of trust on economic performance are reviewed. We document the mechanisms of interactions between trust and economic development in the realms of finance, innovation, the organization of firms, the labor market, and the product market. The last part reviews recent progress to identify how institutions and policies can affect trust. |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-01169659&r=all |
| By: | Chen, Ping-ho; Chu, Hsun; Lai, Ching-Chong |
| Abstract: | This paper analyzes the growth effect of subsidy policies in a modified R&D-based growth model of Romer (1990), in which both innovation and capital accumulation are engines of long-run economic growth. We show that, under certain conditions, subsidizing the R&D sector may be growth-impeding. |
| Keywords: | R&D; subsidy policy; endogenous growth; |
| JEL: | H2 O3 |
| Date: | 2015–08 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:66061&r=all |
| By: | Raouf Boucekkine (AMSE - Aix-Marseille School of Economics - EHESS - École des hautes études en sciences sociales - Centre national de la recherche scientifique (CNRS) - Ecole Centrale Marseille (ECM) - AMU - Aix-Marseille Université); Benteng Zou (CREA - Center for Research in Economic Analysis - Uni.lu - Université du Luxembourg) |
| Abstract: | This note studies the stochastic stability of the standard AK growth model under uncertain output technology. Capital accumulation follows a stochastic linear homogenous differential equation. It's shown that exponential balanced paths, which characterize optimal trajectories in the absence of uncertainty, are not robust to uncertainty. Precisely, it's demonstrated that the economy almost surely collapses at exponential speed even though productivity is initially arbitrarily high. |
| Date: | 2014–12 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-01090877&r=all |
| By: | Raouf Boucekkine (IUF - Institut Universitaire de France - M.E.N.E.S.R. - Ministère de l'Éducation nationale, de l’Enseignement supérieur et de la Recherche, AMSE - Aix-Marseille School of Economics - EHESS - École des hautes études en sciences sociales - Centre national de la recherche scientifique (CNRS) - Ecole Centrale Marseille (ECM) - AMU - Aix-Marseille Université); Patrick Pintus (AMSE - Aix-Marseille School of Economics - EHESS - École des hautes études en sciences sociales - Centre national de la recherche scientifique (CNRS) - Ecole Centrale Marseille (ECM) - AMU - Aix-Marseille Université); Benteng Zou (CREA - Center for Research in Economic Analysis - Uni.lu - Université du Luxembourg) |
| Abstract: | We examine the issue of stability of stochastic endogenous growth. First, stochastic stability concepts are introduced and applied to stochastic linear homogenous differential equations to which several stochastic endogenous growth models reduce. Second, we apply the mathematical theory to two models, starting with the stochastic AK model. It's shown that in this case exponential balanced paths, which characterize optimal trajectories in the absence of uncertainty, are not robust to uncertainty: the economy may almost surely collapse at exponential speed even though productivity is initially arbitrarily high. Finally, we revisit the seminal global diversification endogenous growth model (Obstfeld, 1994): taking into account stochastic stability calls for a redefinition of the mean growth concept, which leads to revisit the established wisdom on the growth effect of global diversification. |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-01181505&r=all |
| By: | Effiong, Ekpeno |
| Abstract: | The paper investigates the effect of financial development on economic growth conditional on the level of institutional quality for a panel of 21 Sub-Saharan African countries for the period 1986-2010. A standard growth regression is estimated with linear interaction between financial development and institutional quality. Our findings indicate that financial development has not significantly contributed to SSA economic growth, contrary to the significant positive effect of institutional quality. The interaction effect of both financial and institutional development is positive but insignificant. This evidence suggest the existing institutions has not enhanced the finance-growth relationship in the region. Therefore, improving institutions relevant to the financial sector is desired. |
| Keywords: | Financial development, Institutions, Economic growth, Sub-Saharan Africa |
| JEL: | C23 G21 O16 O55 |
| Date: | 2015–08 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:66085&r=all |