nep-gro New Economics Papers
on Economic Growth
Issue of 2020‒04‒13
nine papers chosen by
Marc Klemp
University of Copenhagen

  1. Ancient Origins of the Global Variation in Economic Preferences By Becker, Anke; Enke, Benjamin; Falk, Armin
  2. Structural Transformation, Industrial Specialization, and Endogenous Growth By Paula Bustos; Juan Manuel Castro Vincenzi; Joan Monras; Jacopo Ponticelli
  3. The Legacy of the Missing Men The Long-Run Impact of World War I on Female Labor Force Participation By Victor Gay
  4. Regional Convergence in Russia: Estimating a Neoclassical Growth Model By Lehmann, Hartmut; Oshchepkov, Aleksey; Silvagni, Maria Giulia
  5. The role of ICT in modulating the effect of education and lifelong learning on income inequality and economic growth in Africa By Vanessa S. Tchamyou; Simplice A. Asongu; Nicholas M. Odhiambo
  6. The Deep Imprint of Roman Sandals: Evidence of Long-lasting Effects of Roman Rule on Personality, Economic Performance, and Well-Being in Germany By Michael Fritsch; Martin Obschonka; Fabian Wahl; Michael Wyrwich
  7. International Transactions: Real Trade and Factor Flows between 1700 and 1870 By Wolfgang Keller; Markus Lampe; Carol H. Shiue
  8. The Paradox of Thrift in the Two-Sector Kaleckian Growth Model By Fanti, Lucrezia; Zamparelli, Luca
  9. Should Germany Have Built a New Wall? Macroeconomic Lessons from the 2015-18 Refugee Wave By Christopher Busch; Dirk Krueger; Alexander Ludwig; Irina Popova; Zainab Iftikhar

  1. By: Becker, Anke (University of Bonn); Enke, Benjamin (University of Bonn); Falk, Armin (briq, University of Bonn)
    Abstract: Variation in economic preferences is systematically related to both individual and aggregate economic outcomes, yet little is known about the origins of the worldwide preference variation. This paper uses globally representative data on risk aversion, time preference, altruism, positive reciprocity, negative reciprocity, and trust to uncover that contemporary preference heterogeneity has its roots in the structure of the temporally distant migration patterns of our very early ancestors: In dyadic regressions, differences in preferences between populations are significantly increasing in the length of time elapsed since the ancestors of the respective groups broke apart from each other. To document this pattern, we link genetic and linguistic distance measures to population-level preference differences (i) in a wide range of cross-country regressions, (ii) in within-country analyses across groups of migrants, and (iii) in analyses that leverage variation across linguistic groups. While temporal distance drives differences in all preferences, the patterns are strongest for risk aversion and prosocial traits.
    Keywords: risk preferences, time preferences, social preferences, origins of preferences
    JEL: D01 D03
    Date: 2020–03
  2. By: Paula Bustos (CEMFI, Centro de Estudios Monetarios y Financieros); Juan Manuel Castro Vincenzi (University of Princeton); Joan Monras (Universitat Pompeu Fabra); Jacopo Ponticelli (Northwestern University)
    Abstract: The introduction of new technologies in agriculture can foster structural transformation by freeing workers who find occupation in other sectors. The traditional view is that this increase in labor supply in manufacturing can lead to industrial development. However, when workers moving to manufacturing are mostly unskilled, this process reinforces a country's comparative advantage in low-skill intensive industries. To the extent that these industries undertake less R&D, this change in industrial composition can lead to lower long-run growth. We provide empirical evidence of this mechanism using a large and exogenous increase in agricultural productivity due to the legalization of genetically engineered soy in Brazil. Our results indicate that improvements in agricultural productivity, while positive in the short-run, can generate specialization in less-innovative industries and have negative effects on productivity in the long-run.
    Keywords: Agricultural productivity, skill-biased technical change, labor mobility, genetically engineered soy, Brazil.
    JEL: J43 O13 O14 O33 Q15 Q16
    Date: 2019–03
  3. By: Victor Gay (TSE - Toulouse School of Economics - UT1 - Université Toulouse 1 Capitole - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, IAST - Institute for Advanced Study in Toulouse)
    Abstract: This paper explores the pathways that underlie the diffusion of women's participation in the labor force across generations. I exploit a severe exoge-nous shock to the sex ratio, World War I in France, which generated a large inflow of women in the labor force after the war. I show that this shock to female labor transmitted to subsequent generations until today. Three mechanisms of intergenerational transmission account for this result: parental transmission, transmission through marriage, and transmission through local social interactions. Beyond behaviors, the war also permanently altered beliefs toward the role of women in the labor force. (JEL J16, J22, N34, Z13)
    Keywords: Social norm,Military fatalities,Female labor force participation,Female labor supply,Intergenerational transmission,World War I,Gender norms,Economic History,Culture
    Date: 2019–04
  4. By: Lehmann, Hartmut (University of Bologna); Oshchepkov, Aleksey (NRU HSE, Moscow); Silvagni, Maria Giulia (University of Bologna)
    Abstract: In this paper, we study convergence in per capita gross regional products across Russian regions in the period from 1996 to 2017. To this purpose, we estimate growth equations, which are directly derived from a neoclassical growth model, augmented with human capital and migration. To our knowledge, this is the first paper that explicitly applies a neoclassical model to analyze the regional convergence process in the Russian case. We also take into account possible spatial effects and do a series of other robustness checks. Our main estimates establish a convergence rate of around 2% per year. While we fail to find any role of human capital for regional economic growth, we find that interregional migration and interdependencies of the growth experience of Russian regions contribute to economic convergence between them.
    Keywords: migration, regional economics, economic growth, convergence, Russia
    JEL: O47 R11 P2
    Date: 2020–03
  5. By: Vanessa S. Tchamyou (Yaounde, Cameroon); Simplice A. Asongu (Yaoundé, Cameroon); Nicholas M. Odhiambo (Pretoria, South Africa)
    Abstract: This study assesses the role of ICT in modulating the impact of education and lifelong learning on income inequality and economic growth. It focuses on a sample of 48 African countries from 2004 to 2014. The empirical evidence is based on the generalised method of moments (GMM). The following findings are established. First, mobile phone and internet each interact with primary school education to decrease income inequality. Second, all ICT indicators interact with secondary school education to exert a negative impact on the Gini index. Third, fixed broadband distinctly interacts with primary school education and lifelong learning to have a positive effect on economic growth. Fourth, ICT indicators do not significantly influence inequality and economic growth through tertiary school education and lifelong learning. These main findings are further substantiated. Policy implications are discussed.
    Keywords: Education; Lifelong learning; ICT; Inequality; Africa
    JEL: I28 I20 I30 L96 O55
    Date: 2019–01
  6. By: Michael Fritsch (Friedrich Schiller University Jena, Germany); Martin Obschonka (Queensland University of Technology, Brisbane, Australia); Fabian Wahl (University of Hohenheim, Germany); Michael Wyrwich (University of Groningen, The Netherlands, and Friedrich Schiller University Jena, Germany)
    Abstract: We investigate whether the Roman presence in the southern part of Germany nearly 2,000 years ago had a deep imprinting effect with long run consequences on a broad spectrum of measures ranging from present-day personality profiles to a number of socioeconomic outcomes and why. Today's populations living in the former Roman part of Germany score indeed higher on certain personality traits, have higher life and health satisfaction, longer life expectancy, generate more inventions and behave in a more entrepreneurial way. These findings help explain that regions under Roman rule have higher present-day levels of economic development in terms of GDP per capita. The effects hold when controlling for other potential historical influences. When addressing potential channels of a long term effect of Roman rule the data indicates that the Roman road network plays an important role as a mechanism in the imprinting that is still perceptible today.
    Keywords: Romans, personality traits, culture, well-being, regional performance, Limes
    JEL: N9 O1 I31
    Date: 2020–03–30
  7. By: Wolfgang Keller; Markus Lampe; Carol H. Shiue
    Abstract: This paper describes broad regional and temporal trends in the evolution of international trade and international factor flows between 1700 and 1870, including key differences in trade costs across space and time. We find trade links in Western Europe and the European colonies of North America intensified at the same time these regions experienced the initial industrial revolution and the spread of industrialization, which led to sustained economic growth. At the same time, global differences in specialization and income emerged. To understand the contribution of global market forces, as well as colonialism to these differences, the chapter lays out theoretical reasons for links between trade and economic growth and examines related historical arguments and evidence. We conclude that trade contributed to global divergence, but the magnitude and mechanisms through which trade affected global welfare lies not so much in the direct impact of trade and specialization, but in multiplier effects emerging from the interactions of trade with other factors that affect economic development.
    JEL: N10
    Date: 2020–03
  8. By: Fanti, Lucrezia; Zamparelli, Luca
    Abstract: We analyze the paradox of thrift in the two-sector Kaleckian growth model. We consider an economy with one consumption and one investment good, and differential sectoral mark-ups. We show that when the investment function depends on aggregate capacity utilization and on the aggregate profit share (the Bhaduri-Marglin investment function) the paradox of thrift in its growth version may fail if mark-ups are higher in the investment good sector. In this case, the reduction in the saving rate produces a reallocation of economic activity towards the investment good sector; the aggregate profit share rises and its positive effect on investment may offset the reduction in average capacity utilization if investment is relatively more sensitive to profitability than to the level of activity.
    Keywords: two-sector growth model, paradox of thrift, Bhaduri-Marglin investment function
    JEL: D33 E11
    Date: 2020–03–21
  9. By: Christopher Busch (Universitat Autonoma de Barcelona); Dirk Krueger (University of Pennsylvania); Alexander Ludwig (SAFE, University of Mannheim); Irina Popova (Goethe University Frankfurt); Zainab Iftikhar (Goethe University Frankfurt)
    Abstract: In 2015-2016 Germany experienced a wave of predominantly low-skilled refugee immigration. We evaluate its macroeconomic and distributional effects using a quantitative overlapping generations model calibrated using German micro data to replicate education and productivity differentials between foreign born and native workers. Workers are modelled as imperfect substitutes in aggregate production leading to endogenous wage differentials. We simulate the dynamic effects of this refugee wave, with specific focus on the welfare impact on low skilled natives. Our results indicate that the small losses this group suffers can be compensated by welfare gains of other parts of the native population.
    Keywords: immigration, refugees, overlapping generations, demographic change
    JEL: F22 E20 H55
    Date: 2020–03

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