nep-gro New Economics Papers
on Economic Growth
Issue of 2017‒06‒11
five papers chosen by
Marc Klemp
Brown University

  1. Endogenous Childlessness and Stages of Development By Baudin, Thomas; de la Croix, David; Gobbi, Paula
  2. Technology Adoption, Capital Deepening, and International Productivity Differences By Chaoran Chen
  3. Can HIV alter the quantity-quality switch and delay the fertility transition in Sub-Saharan Africa? By Gori, Luca; Lupi, Enrico; Manfredi, Piero; Sodini, Mauro
  4. Dynamics of Electricity Consumption, Oil Price and Economic Growth: Global Perspective By Muhammad, Shahbaz; Sarwar, Suleman; Wei, Chen; Malik, Muhammad Nasir
  5. Interest premium and economic growth: the case of CEE By Daniel Baksa; István Konya

  1. By: Baudin, Thomas; de la Croix, David; Gobbi, Paula
    Abstract: Although developing countries are characterized by high average fertility rates, they are as concerned by childlessness as developed countries. Beyond natural sterility, there are two main types of childlessness: one driven by poverty and another by the high opportunity cost of childrearing. We measure the importance of the components of childlessness with a structural model of fertility and marriage. Deep parameters are identified using census data from 36 developing countries. As average education increases, poverty-driven childlessness first decreases to a minimum, and then the opportunity-driven part of childlessness increases. We show that neglecting the endogenous response of marriage and childlessness may lead to a poor understanding of the impact that social progress, such as universal primary education, may have on completed fertility. The same holds for family planning, closing the gender pay gap, and the eradication of child mortality.
    Keywords: Childlessness; education; Fertility; Marriage; poverty; Structural Estimation.; Unwanted Births
    JEL: J11 O11 O40
    Date: 2017–06
  2. By: Chaoran Chen
    Abstract: Cross-country differences in capital intensity are larger in agriculture than in the non-agricultural sector. I build a two-sector model featuring technology adoption in agriculture. As the economy develops, farmers gradually adopt modern capital-intensive technologies to replace traditional labor-intensive technologies, as is observed in the U.S. historical data. Using this model, I find that technology adoption is key to explaining lower agricultural capital intensity and labor productivity in poor countries. By allowing for technology adoption, my model can explain 1.56-fold more in rich-poor agricultural productivity differences. I further show that land misallocation impedes technology adoption and magnifies productivity differences.
    Keywords: Agricultural Productivity, Technology Adoption, Capital Intensity, Misallocation.
    JEL: E13 O41 Q12 Q16
    Date: 2017–06–05
  3. By: Gori, Luca; Lupi, Enrico; Manfredi, Piero; Sodini, Mauro
    Abstract: According to the conventional theory of the demographic transition, mortality decline has represented the major trigger for fertility decline and eventually sustained economic development. In Sub-Saharan Africa (SSA), the HIV/AIDS epidemic has had a devastating impact on mortality, by dramatically reversing, in high HIV-prevalence countries, the long-term positive trend in life expectancies. Despite the fact that SSA as a whole is suffering a delayed and slow fertility transition compared to other world’s regions, and despite evidence for halting or even reverting fertility decline in countries with severe HIV epidemics, there seems to be little concern amongst international policy makers, about the ultimate impact that HIV might have on SSA fertility. This work reports model-based evidence of the potential for a HIV-triggered reversal of fertility in high HIV-prevalent SSA countries induced by the fall in education and human capital investments following the drop in life expectancy for young adults. This eventually breaks down the virtuous circle promoting the switch quantity-to-quality of children. This result suggests that the current evidence on fertility halting and declining education in high HIV-prevalent SSA countries should be seriously taken into consideration to prioritise current international interventions.
    Keywords: Sub-Saharan Africa,fertility transition,quantity-quality switch,HIV/AIDS epidemics,human capital accumulation,fertility reversal
    JEL: J11 J13 O1 O41
    Date: 2017
  4. By: Muhammad, Shahbaz; Sarwar, Suleman; Wei, Chen; Malik, Muhammad Nasir
    Abstract: This study uses the data from 157 countries from 1960 to 2014 to analyze the relationship between economic growth, electricity consumption, oil prices, capital, and labor. The economic growth of developing countries with industrial infrastructure has a more significant association with electricity consumption than oil prices. We use oil prices and electricity consumption jointly to study highly predictive observations for economic growth. The data are categorized by income, OECD and regional levels. The panel cointegration, long-run parameter estimation, and Pool Mean Group tests are used to analyze the cointegration and short-run and long-run relationships between the variables. The empirical results indicate the presence of cointegration between the variables. The presence of feedback effects between electricity consumption and economic growth, oil prices and economic growth is valid. These findings confirm that inspite of the oil prices, developing countries rely heavily on electricity consumption for economic growth.In the short run, growth and feedback effects suggest that more vigorous electricity policies should be implemented to attain sustainable economic growth for the long-term.
    Keywords: Electricity Consumption, Oil Prices, GDP, Capital, Population
    JEL: A10
    Date: 2017–05–01
  5. By: Daniel Baksa (Institute of Economics, Research Centre for Economic and Regional Studies, Hungarian Academy of Sciences and Central European University); István Konya (Institute of Economics - Centre for Economic and Regional Studies, Hungarian Academy of Sciences and Central European University)
    Abstract: This paper views the growth and convergence process of the four Visegrad economies - the Czech Republic, Hungary, Poland and Slovakia - through the lens of the open economy, stochastic neoclassical growth model. We use a unified framework to understand both the long-run convergence path and fluctuations around it. Our empirical exercise highlights both the role of initial conditions such as indebtedness and capital intensity, and random shocks in the growth process. In particular, we explore the importance of the external interest rate premium, and its role in driving investment and the trade balance.
    Keywords: stochastic growth, technology shocks, interest premium, small open economy, Bayesian estimation
    JEL: E13 O11 O41 O47
    Date: 2017–04

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