nep-gro New Economics Papers
on Economic Growth
Issue of 2021‒07‒26
thirteen papers chosen by
Marc Klemp
University of Copenhagen

  1. Long-term effects of the Inca Road By Ana Paula Franco; Sebastian Galiani; Pablo Lavado
  2. Genetic Diversity and Performance: Evidence from Fooball Data By Michel Beine; Silvia Peracchi; Skerdilajda Zanaj
  3. Non-Modernization: Power-Culture Trajectories and the Dynamics of Political Institutions By Daron Acemoglu; James A. Robinson
  4. Reinvest the relationship between exports and economic growth in African countries: New insights from innovative econometric methods By Bakari, Sayef
  5. Do researchers affect economic growth? By Bakari, Sayef
  6. Growing like Google: Endogenous Growth with Global Network Externalities By Cordoba, Juan Carlos; He, Sicheng
  7. Resistance to Institutions and Cultural Distance: Brigandage in Post-Unification Italy By Giampaolo Lecce; Laura Ogliari; Tommaso Orlando
  8. Innovation-Driven Entrepreneurship By Tristan L. Botelho; Daniel Fehder; Yael Hochberg
  9. Competition universalism: Its historical origins and timely alternatives By Claudius Graebner; Stephan Puehringer
  10. Economic Development of Quang Nam Province Compared with The Whole Economy Based on Three Strategic Breakthroughs By Ly Dai Hung
  11. Identifying complementary relationships between different types of innovation: Evidence from Community Innovation Survey 2012 By Stojkoski, Viktor; Toshevska-Trpchevska, Katerina; Makrevska Disoska, Elena; Tevdovski, Dragan
  12. Inheritances, social classes, and wealth distribution By Pedro Patr\'icio; Nuno A. M. Ara\'ujo
  13. Counting the Missing Poor in Pre-Industrial Societies. By Mathieu Lefebvre; Pierre Pestieau; Gregory Ponthierez

  1. By: Ana Paula Franco; Sebastian Galiani; Pablo Lavado
    Abstract: The Inca Empire was the last of a long series of highly developed cultures in pre-colonial South America. It stretched across parts of the current territories of Argentina, Bolivia, Chile, Colombia, Ecuador and the whole of Peru. The Inca Road was its 30,000-kilometer-long transportation system. The aim of this study is to identify its long-term impact on current development in Peru. Our results show that the long-run effect of the Inca Road includes increases in wages and educational attainment, a reduction of child malnutrition and an increase in children’s mathematics test scores. We also find that these effects are around 20% greater for women and explore the mechanisms that may account for this pattern.
    JEL: O1
    Date: 2021–07
  2. By: Michel Beine; Silvia Peracchi; Skerdilajda Zanaj
    Abstract: The theoretical impact of genetic diversity is ambiguous since it leads to costs and benefits at the collective level. In this paper, we assess empirically the connection between genetic diversity and the performance of sport teams. Focusing on football (soccer), we built a novel dataset of national teams of European countries that have participated in the European and the World Championships since 1970. Determining the genetic diversity of national teams is based on the distance between the genetic scores of every players’ origins in the team. Genetic endowments for each player are recovered using a matching algorithm based on family names. Performance is measured at both the unilateral and bilateral level. Identification of the causal link relies on an instrumental variable strategy that is based on past immigration at the country level about one generation before. Our findings indicate a positive causal link between genetic diversity and teams’ performance. We find a substantial effect, a one-standard increase in diversity leading to ranking changes of two to three positions after each stage of a championship.
    Keywords: genetic diversity, football, sports team, performance, family names, migration
    JEL: F22 F66 O15 O47 Z22
    Date: 2021
  3. By: Daron Acemoglu; James A. Robinson
    Abstract: Modernization theory is a cornerstone of much of political science, despite the mounting evidence against its predictions. In this paper, we argue that the theory's failings are rooted in predictions that are not conditioned on history and cultural configurations. We outline a theory in which the interplay of the distribution of political power and cultural configurations lead to three distinct self-reinforcing paths of political development, with very different state-society relations, institutions, and economic structures. These are paths to Despotic, Absent and Shackled leviathans. The role of cultural configurations, made up of attributes in a society's culture set, is critical in legitimizing the social arrangements in each path. For example, a Despotic Leviathan, as in China, cannot be understood without appreciating how Confucian culture has been used to bolster a worldview in which rulers are supposed to be virtuous and regular people are discouraged from political participation. We argued that this interpretation is not inherent to Confucian thought, but has to be understood as an endogenous outcome along the trajectory to the Despotic Leviathan. None of the three different paths we highlight support modernization theory. Under the Absent Leviathan, there is no economic modernization. Under the Despotic Leviathan, economic growth bolsters the existing regime and its supporting cultural configuration, with no tendency towards democracy or associate political changes. Under the Shackled Leviathan, there are dynamics leading to economic growth and political changes with greater bottom-up participation. Nevertheless, the causation does not go from the former to the latter, and these changes are critically dependent on cultural and political entrepreneurship in order to formulate and popularize new cultural configurations and institutionalize political changes.
    JEL: N10 O10 P16
    Date: 2021–07
  4. By: Bakari, Sayef
    Abstract: This research examined the relationship between exports and economic growth in Africa. It employed many innovation econometric methods including Panel FMOLS and DOLS Estimates; Panel VECM; Panel ARDL Model; Pooled OLS, Random Effect Model, Fixed Effect Model and Hausman Test; Panel Pairwise Granger Causality Tests; Panel Toda-Yamamoto Causality Test; and Panel GMM Model. The findings suggested that the estimates of each model prove that there is a positive bidirectionnel relationship between exports and economic growth. Data includes 49 African countries for the period 1960–2018. These empirical results have some notable policy implications.
    Keywords: Exports, Economic Growth, Innovative Econometric Methods, African countries
    JEL: F0 F1 F10 F13 F14 O4 O47 O55
    Date: 2021
  5. By: Bakari, Sayef
    Abstract: The great scientific development and the great technology, which turned the globe as a whole into a small village, were not the product of a moment or a coincidence, and this great development did not come out of a empty, but was thanks to a considerable and difficult effort, and the enormous contributions of many scientists, inventors and researchers from various regions They have spent their lives studying, researching, contemplating, serving science and various sciences, with sincerity and dedication to advancing themselves and for all of humanity. Without these scientific revolutions and the great effort they have made, we would not have achieved this great scientific and technological progress which our current era is witnessing at all levels. In this article, using a database that includes 104 countries during the period 1996 -2018, we seek an answer to the following question: Do researchers stimulate economic growth?
    Keywords: Researchers, Economic Growth, Global Evidence
    JEL: I20 I21 I23 I25 I28 O40 O47 O50
    Date: 2021–01
  6. By: Cordoba, Juan Carlos; He, Sicheng
    Abstract: We study endogenous growth in the presence of domestic and international network externalities. In our model, network externalities provide natural protection to first movers and incentivize disruptive innovations without the need for patent protection. Domestic and global growth depends on the extent of network externalities, international compatibility costs, and anti-trust policies. We find that traditional anti-trust policies may lead to unintended outcomes. Policies such as banning price discrimination or collusion may reduce economic growth. In particular, price discrimination and collusion could increase economic growth when network externalities are large in relation to compatibility costs.
    Date: 2021–07–16
  7. By: Giampaolo Lecce (Groningen University); Laura Ogliari (University of Milan); Tommaso Orlando (Bank of Italy)
    Abstract: What determines the rejection of exogenously imposed institutions? To address this question, we exploit the transplantation of institutions that occurred when southern Italy was annexed to Piedmont, during the Italian unification process of the 1860s. We assemble a novel dataset on episodes of brigandage, a form of violent uprising against the unitary government, and on pre-unification social and economic characteristics of southern Italian municipalities. We find that the intensity of institutional rejection is ceteris paribus lower in and close to settlements of Piedmontese origin. We argue that geographical distance from these communities is a proxy for cultural distance from the Piedmontese rulers. Thus, our results suggest that cultural proximity to the ‘donor’ reduces institutional rejection by ‘recipient’ communities in the context of institutional transplantations. We rule out alternative mechanisms proposed by the economic literature, provide suggestive evidence of cultural persistence and diffusion in our context, and discuss two possible culture-based interpretations of our results: a clash between local values and the content of the new institutions, and social identification with the Piedmontese rulers.
    Keywords: Institutions, Culture, Institutional Transplantations, Cultural Diffusion
    JEL: N43 D74 P16 Z10
    Date: 2021–04–14
  8. By: Tristan L. Botelho; Daniel Fehder; Yael Hochberg
    Abstract: Entrepreneurship is thought to be a key driver of economic growth. While there are myriad forms of entrepreneurship, ranging from self-employment to small and medium size enterprises to technology- and innovation-driven startups, recent research provides evidence that the relationship between entrepreneurship and economic growth is driven not by overall quantity of new firm entry, but rather by a small subset of high-growth startups that are primarily categorized as innovation-driven. This paper provides a survey of the growing literature on the economics of such innovation-driven entrepreneurship. We begin by distinguishing between the various forms of entrepreneurship, which are often confounded in both theory and empirical work. We lay out the current state of knowledge, and describe the challenges faced by researchers in the field, particularly around measurement, data and identification. We conclude with an overview of the major open questions and directions for future research in the area.
    JEL: O0 O3
    Date: 2021–07
  9. By: Claudius Graebner (Institute for Socio-Economics, University of Duisburg-Essen, Germany; Institute for Comprehensive Analysis of the Economy, Johannes Kepler University Linz, Austria; ZOE Institute for future-fit Economies, Bonn, Germany); Stephan Puehringer (Institute for Comprehensive Analysis of the Economy, Johannes Kepler University Linz, Austria)
    Abstract: This paper discusses the actual relevance and historical origins or ‘competition universalism’. In economics, competition is conceptualized as a nearly ubiquitous element of societies, or, at least, used to study a wide array of social and political relations, including competition between firms for market shares, between individuals for prestige, countries for resources, athletes for victory, or politicians for influence. This trend towards ‘competition universalism’ was facilitated by the increasing dominance of an economic approach that places less weight on descriptive accuracy and a consideration so socio-historical specificities, but instead focuses on the development of general and tractable mathematical models. Thereby, the paper links the trend to competition universalism to developments in the epistemological orientation in economics. It first explicates the historical genesis of competition universalism, then discusses the extent it has reached today, and concludes with critical remarks and the proposition of an alternative, more particularist approach to study competition.
    Keywords: competition universalism; economic and social sphere; economic imperialism; economic methodology
    Date: 2021–05
  10. By: Ly Dai Hung (Vietnam Institute of Economics, Hanoi, Vietnam)
    Abstract: The paper analyzes the development pathway of Quang Nam province in comparison with the whole economy, based on the dynamics of three strategic breakthroughs including institution, human capital and infrastructure. The research method combines qualitative and quantitative analysis, based on a sample of 63 provinces in Vietnam covering the 2010-2019 period. The qualitative results show that Quang Nam has remarkable achievements with higher economic growth and more equal income distribution than the country average. Moreover, according to the quantitative results, Quang Nam has a better income convergence than the prediction by empirical models based on three strategic breakthroughs.
    Keywords: Economic of Regions and Provinces,Quang Nam,Economic Development,Cross-Section Regression
    Date: 2021–04
  11. By: Stojkoski, Viktor; Toshevska-Trpchevska, Katerina; Makrevska Disoska, Elena; Tevdovski, Dragan
    Abstract: We explore the complementarities between technological and organizational innovations by utilizing cross-sectional data taken from the Community Innovation Survey - CIS2012 for two group of countries: Central and Eastern Europe (CEE - Bulgaria, Czech Republic, Estonia, Hungary, Latvia, Romania, Slovakia and Slovenia) and Western European countries (WE - Germany, Spain, Norway and Portugal). We find that in CEE there is no complementarity between the different types of innovation analyzed. On the other hand, we show that probably in WE there is complementary relationship between organizational and process innovations, but not between organizational and product innovation. Altogether, this indicates that there is a variety in the relationships between the types of innovation in more developed countries (the WE group), but not in less developed countries (CEE group).
    Keywords: innovation, complementarity, CDM model, Western Europe, Central and Eastern Europe
    JEL: O31 O33
    Date: 2021–07
  12. By: Pedro Patr\'icio; Nuno A. M. Ara\'ujo
    Abstract: We consider a simple theoretical model to investigate the impact of inheritances on the wealth distribution. Wealth is described as a finite resource, which remains constant over different generations and is divided equally among offspring. All other sources of wealth are neglected. We consider different societies characterized by a different offspring probability distribution. We find that, if the population remains constant, the society reaches a stationary wealth distribution. We show that inequality emerges every time the number of children per family is not always the same. For realistic offspring distributions from developed countries, the model predicts a Gini coefficient of $G\approx 0.3$. If we divide the society into wealth classes and set the probability of getting married to depend on the distance between classes, the stationary wealth distribution crosses over from an exponential to a power-law regime as the number of wealth classes and the level of class distinction increase.
    Date: 2021–06
  13. By: Mathieu Lefebvre; Pierre Pestieau; Gregory Ponthierez
    Abstract: Under income-differentiated mortality, poverty measures suffer from a selection bias: they do not count the missing poor (i.e. persons who would have been counted as poor provided they did not die prematurely). The Pre-Industrial period being characterized by an evolutionary advantage (i.e. a higher number of surviving children per household) of the non-poor over the poor, one may expect that the missing poor bias is substantial during that period. This paper aims at estimating the missing poor bias in Pre-Industrial societies, by computing the hypothetical headcount poverty rates that would have prevailed provided the non-poor did not benefit from an evolutionary advantage over the poor. Using data on Pre-Industrial England, we show that the sign and size of the missing poor bias is sensitive to the degree of downward mobility for the non-poor.
    Keywords: poverty, measurement, selection e¤ects, missing poor.
    JEL: I32
    Date: 2021

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