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on Financial Development and Growth |
| By: | Escobari, Diego; Mollick, André Varella |
| Abstract: | This paper takes into account the dynamic feedback between government expenditures and output in a model that separates the effects of expected and unexpected government expenditures on output. We allow for standard determinants based on Solow’s growth model, as well as financial globalization and trade openness measures for a sample of 56 industrial and emerging market economies over the 1970-2004 period. We find that unanticipated government expenditures have negative and significant effects on output growth, with higher effects in developed economies. Along with savings responses, we interpret these results based on how fiscal policy reacts to business cycles. Anticipated government expenditures have negative - but smaller effects - on output growth. These results are very robust to a recursive treatment of expectations, which reinforces the role of new information in an increasingly integrated world economy. |
| Keywords: | Dynamic Panels, Economic Growth, Expected and Unexpected Government Expenditures, Globalization. |
| JEL: | E32 E62 F43 |
| Date: | 2013–08 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:48969&r=fdg |
| By: | Eric Fesselmeyer; Leonard J. Mirman; Marc Santugini (IEA, HEC Montréal) |
| Abstract: | We study the effect of investment on the dynamics of aggregate capital when different sectors of the economy compete strategically for the utilization of non-excludable capital to produce both consumption and investment goods. We consider two types of investment goods: complements and substitutes. For each case, we derive the equilibrium and provide the corresponding stationary distribution. We then compare the equilibrium with the social planner's optimal solution. |
| Keywords: | Capital accumulation, Dynamic game, Growth, Investment, Non-excludable capital |
| JEL: | C72 C73 D81 D92 O40 |
| Date: | 2013–07 |
| URL: | http://d.repec.org/n?u=RePEc:iea:carech:1301&r=fdg |
| By: | Liu, Yanyan; Yamauchi, Futoshi |
| Abstract: | Rapid population growth in many developing countries has raised concerns regarding food security and household welfare. To understand the consequences of population growth on in the general equilibrium setting, we examine the dynamics of population density and its impacts on household outcomes using panel data from Indonesia. More specifically we explicitly highlight the importance of migration to urban sectors in the analysis. Empirical results show that human capital in the household determines the effect of increased population density on per capita household consumption expenditure. The effect of population density is positive if the average educational attainment is high (above junior high school), while it is negative otherwise. |
| Keywords: | Population growth, Migration, Land ownership, Rural economy, economic growth, Education, High value agriculture, Land rights, rural areas, |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:fpr:ifprid:1271&r=fdg |
| By: | Schreiber, Sven |
| Abstract: | Short answer: It helps a lot when other important variables are excluded from the information set. Longer answer: We revisit claims in the literature that money growth is Granger-causal for inflation at low frequencies. Applying frequency-specific tests in a comprehensive system setup for euro-area data we consider various theoretical predictors of inflation. A general-to-specific testing strategy reveals a recursive structure where only the unemployment rate and long-term interest rates are directly Granger-causal for low-frequency inflation movements, and all variables affect money growth. We therefore interpret opposite results from bivariate inflation/money growth systems as spurious due to omittedvariable biases. We also analyze the resulting four-dimensional system in a cointegration framework and find structural changes in the long-run adjustment behavior, which do not affect the main conclusions, however. -- |
| Keywords: | money growth,granger causality,quantity theory,unemployment |
| JEL: | E31 E40 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:fubsbe:201310&r=fdg |