nep-gro New Economics Papers
on Economic Growth
Issue of 2022‒05‒09
ten papers chosen by
Marc Klemp
University of Copenhagen

  1. Energy Efficiency and Directed Technical Change: Implications for Climate Change Mitigation By Gregory P. Casey
  2. Intangible Capital and Labor Productivity Growth – Revisiting the Evidence: An Update By Roth, Felix
  3. More Laws, More Growth? Evidence from U.S. States By Elliott Ash; Massimo Morelli; Matia Vannoni
  4. Accounting for social difference when measuring cultural diversity By David C Maré; Jacques Poot
  5. Alternative theories on economic growth and the co-evolution of macro-dynamics and technological change : a survey By Patrick Llerena; Andre Lorentz
  6. The Triumph of the Placeless By Jones, Calvin
  7. Harmonious Relations: Quality transmission among composers in the very long run By Karol Jan Borowiecki; Nicholas Ford; Maria Marchenko
  8. A Cliometric Reading of the Development of Primary Education in France in the Nineteenth Century By Claude Diebolt; Magali Jaoul-Grammare; Faustine Perrin
  9. Early life height and weight production functions with endogenous energy and protein inputs By Esteban Puentes; Fan Wang; Jere R. Behrman; Fl\'avio Cunha; John Hoddinott; John A. Maluccio; Linda S. Adair; Judith B. Borja; Reynaldo Martorell; Aryeh D. Stein
  10. Wealth and its Distribution in Germany, 1895-2018 By Thilo N. H. Albers; Charlotte Bartels; Moritz Schularick

  1. By: Gregory P. Casey
    Abstract: I build a quantitative model of economic growth that can be used to evaluate the impact of environmental policy interventions on final-use energy consumption, an important driver of carbon emissions. In the model, energy demand is driven by directed technical change. Energy supply is subject to increasing extraction costs. The model is consistent with aggregate evidence on energy use, efficiency, and prices in the United States, as well as the standard balanced growth facts. I use the model to conduct several policy analyses. First, I examine the impact of energy taxes and compare the results to the standard Cobb-Douglas approach used in the environmental macroeconomics literature. Second, I investigate how the government can use energy taxes and R&D policy to implement the least-cost path that achieves an environmental target. Finally, I study the dynamic impacts of exogenous improvements in energy efficiency and R&D subsidies for energy efficiency, focusing on the role of rebound. All analyses highlight the importance of transition dynamics.
    Keywords: energy, climate change, directed technical change, growth
    JEL: H23 O33 O44 Q43 Q55
    Date: 2022
  2. By: Roth, Felix
    Abstract: This contribution analyzes the impact of intangible capital on labor productivity growth across countries at the aggregate and sectoral levels by employing an econometric growth-accounting approach. First, our results show that intangible capital deepening accounts for around 50 percent of labor productivity growth at both the aggregate and sectoral level. Second, we find that this positive impact of intangible capital on productivity growth at both levels of aggregation is driven by investments in economic competencies, the only intangible group not covered in the national accounts. Third, our results reveal deep sectoral heterogeneities regarding investments and productivity effects of different intangible types. These findings have important implications for future EU industrial policies and are directly relevant to the EU's efforts to close its productivity gap with the US.
    Keywords: intangible capital,labor productivity growth,cross-country sectoral panel analysis,manufacturing,market services,EU
    JEL: C23 E22 L16 L60 L80 O47 O52
    Date: 2022
  3. By: Elliott Ash; Massimo Morelli; Matia Vannoni
    Abstract: This paper analyzes the conditions under which more legislation contributes to economic growth. In the context of U.S. states, we apply natural language processing tools to measure legislative flows for the years 1965-2012. We implement a novel shift-share design for text data, where the instrument for legislation is leave-one-out legal-topic flows interacted with pre-treatment legal-topic shares. We find that at the margin, higher legislative output causes more economic growth. Guided by a simple model of reform decision-making under uncertainty, we find that the effect is driven by contingent clauses, that the effect is concave in the preexisting stock of legislation, and that the effect size is increasing with economic policy uncertainty.
    Keywords: Legislative production, growth, regulatory complexity, economic uncertainty
    Date: 2022
  4. By: David C Maré (Motu Economic and Public Policy Research); Jacques Poot (Te Ngira: Institute for Population Research, University of Waikato)
    Abstract: In this paper we introduce a measure of cultural diversity that takes ‘social difference’ between country of birth and ethnic groups into account. We measure social difference using exploratory factor analysis of subjective identity, attitude and value responses in Aotearoa New Zealand’s 2016 General Social Survey. We examine the level of, and change in, our social difference-based measure of cultural diversity in 31 urban areas between 1976 and 2018, using census data. We compare these patterns with those derived from a standard fractionalisation measure of diversity based on population composition by country of birth and ethnicity. We find that the two diversity measures are highly correlated across the urban areas. Diversity increased everywhere between 1976 and 2018, whether social difference is taken into account or not. However, the social difference-based measure increased much faster than the standard measure in all but one of the urban areas. This suggests that growth in the fractionalisation measure of diversity is likely to have underestimated the trend in experienced social difference. Both measures also show evidence of spatial convergence in diversity: urban areas with low diversity in 1976 – which tended to be in the South Island – exhibited faster increases. Population diversity increased strikingly in Queenstown, which was the 19th most diverse urban area in 1976, in terms of social difference, but second only to Auckland in 2018.
    Keywords: Cultural diversity; social difference; fractionalisation; New Zealand; urban
    JEL: J15 R23 Z13
    Date: 2022–04
  5. By: Patrick Llerena (BETA - Bureau d'Économie Théorique et Appliquée - INRA - Institut National de la Recherche Agronomique - UNISTRA - Université de Strasbourg - UL - Université de Lorraine - CNRS - Centre National de la Recherche Scientifique); Andre Lorentz (BETA - Bureau d'Économie Théorique et Appliquée - INRA - Institut National de la Recherche Agronomique - UNISTRA - Université de Strasbourg - UL - Université de Lorraine - CNRS - Centre National de la Recherche Scientifique, Institute of Economics of Sant'Anna [Pisa] - SSSUP - Scuola Universitaria Superiore Sant'Anna [Pisa])
    Abstract: This paper aims to propose an approach to endogeneous growth considering the relationship between macro-dynamics and technical change. We draw upon two stream of literature: Cumulative causation and its macroscopic view of economic dynamics, and Evo-lutionary economics and its focus on micro-determinants of technical change. This paper presents a survey of the formal representation of the growth process and identifies the possible bridges between these two approaches. Our claim is that merging these two distinct theories might offer a framework to consider the co-evolution of macro-dynamics and technical change.
    Keywords: Economic Growth,Technical Change,Cumulative Causation,Evolutionary Theory
    Date: 2022–02–22
  6. By: Jones, Calvin
    Abstract: Although three centuries of industrialisation and growth have led to unimaginably better lives for most people, economic and health outcomes differ widely across places, both between and within polities. We suggest that understanding these differences requires considering the role of ‘placeless’ agents in shaping places – here, subnational regions. Prior economic development and globalisation have rewarded and empowered placeless agents: firms, people and institutions which rely for wellbeing, identity and profits not on a specific place, but rather on a type or types of place. Their mobility and lack of embeddedness means interactions with specific places is functionally narrow, voluntary, self-interested, and hence potentially problematic for embedded actors, and for the health and viability of the places within which they operate. We look to operationalise this concept by developing notions of economic, socio-cultural and civic placelessness, and reflect on how the power of the placeless may shape local responses to critical challenges.
    Date: 2022–04–07
  7. By: Karol Jan Borowiecki (Department of Economics, University of Southern Denmark); Nicholas Ford (Department of Economic History, Lund University); Maria Marchenko (Department of Economics, Vienna University of Economics and Business)
    Abstract: Most creatives acquire professional talents by learning from others, but in most settings it is difficult to estimate the existence of long-term effects. This paper explores the transmission of skills over a period of more than seven centuries by focusing on the case of music composers. We ask the question: how does a composer’s quality influence the quality of the composers he or she teaches? Our analysis builds on a unique dataset of 17,433 composers from around the world since the fourteenth century. By comparing actual teacher–student pairs with plausible counterfactual pairs and by using a two-stage framework, we show a strong effect of quality transmission. Moreover, we find quality transmission persists across multiple generations: from teacher to student, and subsequently to student’s student and so on. Our results provide new insights on drivers of creativity over the very long term, as well as the influence of teachers on students’ achievements.
    Keywords: creativity, transmission of ideas, music history, teacher influence
    JEL: I21 J24 N30 O31 Z11
    Date: 2022–05
  8. By: Claude Diebolt (BETA/CNRS (UMR 7522), University of Strasbourg, 61 avenue de la Forêt Noire, France); Magali Jaoul-Grammare (BETA/CNRS (UMR 7522), University of Strasbourg, 61 avenue de la Forêt Noire, France); Faustine Perrin (Department of Economic History, Lund University, Box 7080, 220 07 Lund, Sweden)
    Date: 2022
  9. By: Esteban Puentes; Fan Wang; Jere R. Behrman; Fl\'avio Cunha; John Hoddinott; John A. Maluccio; Linda S. Adair; Judith B. Borja; Reynaldo Martorell; Aryeh D. Stein
    Abstract: We examine effects of protein and energy intakes on height and weight growth for children between 6 and 24 months old in Guatemala and the Philippines. Using instrumental variables to control for endogeneity and estimating multiple specifications, we find that protein intake plays an important and positive role in height and weight growth in the 6-24 month period. Energy from other macronutrients, however, does not have a robust relation with these two anthropometric measures. Our estimates indicate that in contexts with substantial child undernutrition, increases in protein-rich food intake in the first 24 months can have important growth effects, which previous studies indicate are related significantly to a range of outcomes over the life cycle.
    Date: 2022–04
  10. By: Thilo N. H. Albers (Humboldt University Berlin; Lund University); Charlotte Bartels (DIW Berlin; UCFS; IZA); Moritz Schularick (University of Bonn, Sciences Po Paris, and CEPR)
    Abstract: German history over the past 125 years has been turbulent. Marked by two world wars, revolutions and major regime changes, as well as a hyperinflation and three currency reforms, expropriations and territorial divisions, it provides unique insights into the role of country-specific shocks in shaping long-run wealth dynamics. This paper presents the first comprehensive study of wealth and its distribution in Germany since the 19th century. We combine tax and archival data, household surveys, historical national accounts, and rich lists to analyze the evolution of the German wealth distribution over the long run. We show that the top 1% wealth share has fallen by half, from close to 50% in 1895 to 27% today. Nearly all of this decline was the result of changes that occurred between 1914 and 1952. The interwar period and the wealth taxation in the aftermath of World War II stand out as the great equalizers in 20th century German history. After unification in 1990, two trends have left their mark on the German wealth distribution. Households at the top made substantial capital gains from rising business wealth while the middle-class had large capital gains in the housing market. The wealth share of the bottom 50% halved since 1990. Our findings speak to the importance of historical shocks to the distribution and valuations of existing wealth in explaining the evolution of the wealth distribution over the long run.
    Keywords: Wealth inequality; portfolio heterogeneity; saving; wealth taxation.
    JEL: D31 E01 E21 H2 N3
    Date: 2022–05

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