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on Financial Development and Growth |
| By: | Prettner, Klaus; Werner, Katharina |
| Abstract: | We analyze the differential growth effects of basic research, applied research, and embodied human capital accumulation in an R&D-based growth model with endogenous fertility and endogenous education. In line with the empirical evidence, our model allows for i) a negative association between long-run economic growth and population growth, ii) a positive association between long-run economic growth and education, and iii) a positive association between the level of per capita GDP and expenditures for basic research. Our results also indicate that raising public investments in basic research reduces the growth rate of GDP in the short run because resources have to be drawn away from other productive sectors of the economy. These short-run costs of basic research might be an explanation for the reluctance of governments to increase public R&D expenditures notwithstanding the long-run benefits of such a policy. -- |
| Keywords: | basic vs. applied science,endogenous schooling decisions,endogenous fertility decisions,R&D-based growth,governmental research policies |
| JEL: | H41 J11 J24 O32 O41 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:cegedp:186&r=fdg |
| By: | Joscha Beckmann; Marek Endrich; Rainer Schweickert |
| Abstract: | This study investigates the role of government activity in economic growth, arguing that economic systems are important and that, therefore, one size of government does not fit all countries. Taking a panel of 111 countries over the years from 1971 to 2010, we consider clusters of economic systems as predicted by an extended Varieties of Capitalism (VoC) approach. The empirical growth impact of government activity is positive but u-shaped and depends on both the quality of institutions and the institutional setting. For the polar cases of liberal economies and Scandinavian coordinated market economies, the potential growth impact is quite similar and superior to other clusters of countries. However, the maximum growth effect is realized for above-average levels of government activity in the Scandinavian countries, while this would be detrimental to growth in liberal countries. Hence, high levels of government activity are consistent with growth but only in economic systems consistently rooted in a high level of government activity |
| Keywords: | Government spending, regulation, economic growth, economic systems, institutions |
| JEL: | H10 P10 P51 |
| Date: | 2014–01 |
| URL: | http://d.repec.org/n?u=RePEc:kie:kieliw:1903&r=fdg |
| By: | Olivier Thévenon (INED) |
| Abstract: | This paper assesses the extent to which the increase in women's human capital, as measured by educational attainment, has contributed to economic growth in OECD countries over the past five decades. Using longitudinal cross-country data covering 30 countries from 1960 to 2008 on education (the Barro-Lee dataset) and growth (update of OECD data), our results point out a positive and significant impact ofthe increase in women's educational attainment relative to men on output per capita growth - as measuredby GDP per capita. Our results are robust to the distinction between sub-periods and indicate that the effect of the equalisation of years of completed education on economic growth has been higher in the most recent periods. Results also hold when countries with an above-average increase in years of completed education are removed from the sample. |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:idg:wpaper:202&r=fdg |
| By: | Liang, Lin; Lin, Shanglang; Li, Yong |
| Abstract: | This paper empirically tests the effect of financial knowledge spillovers on agglomeration in China's financial services industry and examines the external effects on cities' economies. The authors apply hierarchical linear modeling to examine a data set that comprises 276 Chinese cities and draw the following conclusions. Firstly, they find that agglomeration in the financial services industry and the Jacobs spillovers of industry diversification both promote financial knowledge spillovers in terms of industry specialization. Secondly, agglomeration in this studied industry has a significant positive influence on a city's economic growth, while financial knowledge spillovers have a significant but negative effect on a city's economic growth. Thirdly, the tendency towards agglomeration in the financial services industry in a few major cities is clear and the clustering significantly influences cities' boundaries. Finally, China's financial services industry is limited by a serious degree of regulation and is dominated by the main banking institutions. -- |
| Keywords: | financial services industry agglomeration,industry specialization,knowledge spillovers,city economies,hierarchical linear modeling |
| JEL: | G20 O4 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifwedp:20146&r=fdg |