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on Economic Growth |
| By: | Remi Jedwab (George Washington University); Noel D. Johnson (George Mason University); Mark Koyama (George Mason University) |
| Abstract: | *This paper is part of a Symposium organized by Dr. Remi Jedwab of the George Washington University that will appear in the Journal of Economic Literature.* The Black Death was the largest demographic shock in European history. We review the evidence for the origins, spread, and mortality of the disease. We document that it was a plausibly exogenous shock to the European economy and trace out its aggregate and local impacts in both the short-run and the long-run. The initial effect of the plague was highly disruptive. Wages and per capita income rose. But, in the long-run, this rise was only sustained in some parts of Europe. The other indirect long-run effects of the Black Death are associated with the growth of Europe relative to the rest of the world, especially Asia and the Middle East (the Great Divergence), a shift in the economic geography of Europe towards the Northwest (the Little Divergence), the demise of serfdom in Western Europe, a decline in the authority of religious institutions, and the emergence of stronger states. Finally, avenues for future research are laid out. |
| Keywords: | Pandemics; Black Death; Institutions; Cities; Urbanization; Malthusian Theory; Demography; Long-Run Growth;Middle Ages; Europe; Asia |
| JEL: | N00 N13 I15 I14 J11 O10 O43 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:gwi:wpaper:2020-14&r=all |
| By: | Claude Diebolt (BETA - Bureau d'Économie Théorique et Appliquée - UL - Université de Lorraine - UNISTRA - Université de Strasbourg - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Karine Pellier |
| Abstract: | This paper examines the structural and spatial dynamics of patents in France, Germany, Japan, the United Kingdom and the United States. The time series are extracted from international, comparative and historical databases on the long-term evolution of patents in 40 countries from the 17th century to 1945 and in more than 150 countries from 1945 to present (Diebolt and Pellier 2010). We have found strong evidence of infrequent large shocks resulting essentially from the major economic and political events formed by the two World Wars in the 20th century. Our results question the autonomous process, i.e. the internal dynamic of the patent systems. Wars seem to drive innovation and, finally, the very process of economic growth. We further investigated the role of innovation in economic growth through a causality analysis between patents and GDP per capita. Our major findings support the assumption that the accumulation of innovations was a driving force only for France, the United Kingdom and the United States during the post-World War II period. |
| Keywords: | database,cliometrics,shock analysis,patents,causality,outliers,comparisons in time and space |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-02929514&r=all |
| By: | Giuliano, Paola (University of California, Los Angeles) |
| Abstract: | This paper reviews the literature on gender and culture. Gender gaps in various outcomes (competitiveness, labor force participation, and performance in mathematics, amongst many others) show remarkable differences across countries and tend to persist over time. The economics literature initially explained these differences by looking at standard economic variables such as the level of development, women's education, the expansion of the service sector, and discrimination. More recent literature has argued that gender differences in a variety of outcomes could reflect underlying cultural values and beliefs. This article reviews the literature on the relevance of culture in the determination of different forms of gender gap. I examine how differences in historical situations could have been relevant in generating gender differences and the conditions under which gender norms tend to be stable or to change over time, emphasizing the role of social learning. Finally, I review the role of different forms of cultural transmission in shaping gender differences, distinguishing between channels of vertical transmission (the role of the family), horizontal transmission (the role of peers), and oblique transmission (the role of teachers or role models). |
| Keywords: | gender, culture, social norms |
| JEL: | A13 J16 Z1 |
| Date: | 2020–08 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp13607&r=all |
| By: | Francisco J. Buera; Joseph P. Kaboski; Martí Mestieri; Daniel G. O'Connor |
| Abstract: | Standard dynamic models of structural transformation, without knife-edge and counterfactual parameter values, preclude balanced growth path (BGP) analysis. This paper develops a dynamic equilibrium concept for a more general class of models — an alternative to a BGP, which we coin a Stable Transformation Path (STraP). The STraP characterizes the medium-term dynamics of the economy in a turnpike sense; it is the path toward which the economy (quickly) converges from an arbitrary initial capital stock. Calibrated simulations demonstrate that the relaxed parameter values that the STraP allows have important quantitative implications for structural transformation, investment, and growth. Indeed, analyzing the dynamics along the STraP, we show that the modern dynamic model of structural transformation makes progress over the Neoclassical growth model in matching key growth and capital accumulation patterns in cross-country data, including slow convergence. |
| JEL: | O1 O11 O14 O4 O41 |
| Date: | 2020–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:27731&r=all |
| By: | Gries, Thomas (University of Paderborn); Naudé, Wim (RWTH Aachen University) |
| Abstract: | The economic impact of Articial Intelligence (AI) is studied using a (semi) endogenous growth model with two novel features. First, the task approach from labor economics is reformulated and integrated into a growth model. Second, the standard representative household assumption is rejected, so that aggregate demand restrictions can be introduced. With these novel features it is shown that (i) AI automation can decrease the share of labor income no matter the size of the elasticity of substitution between AI and labor, and (ii) when this elasticity is high, AI will unambiguously reduce aggregate demand and slow down GDP growth, even in the face of the positive technology shock that AI entails. If the elasticity of substitution is low, then GDP, productivity and wage growth may however still slow down, because the economy will then fail to benefit from the supply-side driven capacity expansion potential that AI can deliver. The model can thus explain why advanced countries tend to experience, despite much AI hype, the simultaneous existence of rather high employment with stagnating wages, productivity, and GDP. |
| Keywords: | technology, artificial intelligence, productivity, labor demand, income distribution, growth theory |
| JEL: | O47 O33 J24 E21 E25 |
| Date: | 2020–08 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp13606&r=all |
| By: | Nhabinde, Simeão (Eduardo Mondlane University); Heshmati, Almas (Jönköping University, Sogang University) |
| Abstract: | The Southern African Development Community (SADC) countries are rich in natural resources and in most of them their extractive industries extract and export natural resources with little industrial processing. This study analyzes the direct and indirect impacts that the extractive industries in the SADC countries have on their economic growth. The study also examines the hypothesis of economic convergence. Its empirical results are based on data from the 11 founding SADC countries covering the period 2004-17. The results show that despite the process of integration, the SADC economies do not converge in terms of per capita incomes. The extractive industries have direct negative impacts on the countries' economic growth thus providing evidence of a resource curse. Extractive industries in South Africa, Botswana, and Namibia have positive direct impacts on their economic growth. However, in terms of indirect impacts, the extractive industries do not have any impact on GDP because their impact on manufacturing, human capital, public expenditure, economic openness, exchange rate, and inflation is insignificant. The study also shows that GDP, the colonial path followed by these countries, and inflation have a negative but insignificant impact on extractive industries, while manufacturing, government expenditure, and economic openness have positive but insignificant impacts in all SADC countries. Human capital and exchange rate are the only factors that have both significant positive and negative impacts on economic growth, respectively. |
| Keywords: | SADC, extractive industry, growth impact, natural resources, resource curse, Africa |
| JEL: | N57 Q13 P48 |
| Date: | 2020–08 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp13586&r=all |
| By: | Parui, Pintu |
| Abstract: | In a stock-flow consistent neo-Kaleckian growth-model, we endogenize the dividend rate and debt-level in the long run and investigate the possibility of multiple equilibria and instability in the economy. We find that the economy is in a wage-led demand and debt-burdened growth regime. However, both debt-led and debt-burdened demand regimes are possible. In some instances, the speed of the adjustment parameter related to the dividend dynamics plays a crucial role in stabilizing the economy. Otherwise, the economy may lose its stability and gives birth to limit cycles. A significant rise in the interest rate may cause instability in the economy. |
| Keywords: | Capital Accumulation, Dividend Rate, Kaleckian Model, Instability, Limit Cycle |
| JEL: | C62 E12 O41 |
| Date: | 2020–09–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:102724&r=all |
| By: | Clemens, Michael A. (Center for Global Development) |
| Abstract: | Many governments seek to reduce emigration from low-income countries by encouraging economic development there. A large literature, however, observes that average emigration rates are higher in countries with sustained increases in GDP per capita than in either chronically poor countries or established rich countries. This suggests an emigration life cycle in which average emigration rst rises, then falls with development. But this hypothesis has not been tested with global datasets controlling for unobserved heterogeneity between countries. This paper finds that emigration rises on average as GDP per capita initially rises in poor countries, slowing after roughly US$5,000 at purchasing power parity, and reversing after roughly $10,000. Before this reversal, the within-country elasticity of rising emigration prevalence to rising GDP per capita is +0.35 to all destinations, and +0.74 to rich destinations. This relationship between emigration ows and economic growth is highly robust to country and time effects (xed or random), specication (linear, log, nonparametric), emigration measure (stock or ow), country subsamples (rich destinations, large origins), and historical period (1960–2019 or 1850–1914). Decomposition of channels for this relationship highlight the joint importance of demographic transition, education investment, and structural change, but question a large role for transportation costs or policy barriers. |
| Keywords: | migration, development, hump, inverse-u, mobility, transition, pressure, poverty, immigration, emigration, demand, growth, opportunity, employment |
| JEL: | F22 J61 O15 |
| Date: | 2020–08 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp13614&r=all |
| By: | Otchia, Christian; Asongu, Simplice |
| Abstract: | This study uses nightlight time data and machine learning techniques to predict industrial development in Africa. The results provide the first evidence on how machine learning techniques and nightlight data can be used to predict economic development in places where subnational data are missing or not precise. Taken together, the research confirms four groups of important determinants of industrial growth: natural resources, agriculture growth, institutions, and manufacturing imports. Our findings indicate that Africa should follow a more multisector approach for development, putting natural resources and agriculture productivity growth at the forefront. |
| Keywords: | Industrial growth; Machine learning; Africa |
| JEL: | I32 O15 O40 O55 |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:101524&r=all |
| By: | Odhiambo, Nicholas M |
| Abstract: | In this paper we examine the causal relationship between energy consumption and economic growth in Botswana during the period 1980-2016. We disaggregate energy consumption into six components, namely: total energy consumption, electricity consumption, motor gasoline, gas/diesel oil, fuel oil and liquefied petroleum gas. We then compare the results of the disaggregated energy components with that of the aggregated energy consumption level. In order to account for the omission-of-variable bias, we incorporate inflation and trade openness as intermittent variables between the various components of energy consumption and economic growth, thereby creating a system of multivariate equations. Using the ARDL-bound testing approach, the study found a causal flow from economic growth to energy consumption to predominate. This finding has important policy implications as it shows that the buoyant economic growth that Botswana has enjoyed over the years is not energy-dependent, and that the country could pursue the requisite energy conservation policies without necessarily stifling its economic growth. To our knowledge, this study may be the first of its kind to examine in detail the causal relationship between energy consumption and economic growth in Botswana using a multivarite causality model and a disaggregated dataset. |
| Keywords: | Botswana, Disaggregated Energy Consumption, Economic Growth, ARDL-bounds Testing Approach |
| Date: | 2020–07 |
| URL: | http://d.repec.org/n?u=RePEc:uza:wpaper:26649&r=all |