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on Economic Growth |
| By: | Peichang Zhang |
| Abstract: | This paper presents an endogenous growth model in which R&D improves product quality and venture capital supports these qualityenhancing activities both financially and nonfinancially. In the model, the venture capitalists' skill in evaluating entrepreneurs' innovative abilities plays a key role in achieving innovation and economic growth. When their skill is suciently low, neither innovation nor economic growth occurs even if entrepreneurs are abundant in the economy. Moreover, insucient market size discourages entrepreneurs from engaging in R&D activities. Therefore, competent venture capitalists and a suciently large market are indispensable to the economy's long-run growth. |
| Date: | 2022–04 |
| URL: | http://d.repec.org/n?u=RePEc:toh:tupdaa:19&r= |
| By: | Ellora Derenoncourt (Princeton University); Chi Hyun Kim (University of Bonn); Moritz Kuhn (University of Bonn); Moritz Schularick (University of Bonn, Sciences Po Paris) |
| Abstract: | The racial wealth gap is the largest of the economic disparities between Black and white Americans, with a white-to-Black per capita wealth ratio of 6 to 1. It is also among the most persistent. In this paper, we construct the first continuous series on white-to-Black per capita wealth ratios from 1860 to 2020, drawing on historical census data, early state tax records, and historical waves of the Survey of Consumer Finances, among other sources. Incorporating these data into a parsimonious model of wealth accumulation for each racial group, we document the role played by initial conditions, income growth, savings behavior, and capital returns in the evolution of the gap. Given vastly different starting conditions under slavery, racial wealth convergence would remain a distant scenario, even if wealth-accumulating conditions had been equal across the two groups since Emancipation. Relative to this equal-conditions benchmark, we find that observed convergence has followed an even slower path over the last 150 years, with convergence stalling after 1950. Since the 1980s, the wealth gap has widened again as capital gains have predominantly benefited white households, and income convergence has stopped. |
| Keywords: | Wealth gap, Racial wealth gap, inequality, historical data |
| JEL: | D63 |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:pri:cepsud:296&r= |
| By: | Andreas Eder (Institute for Industrial Research, Mittersteig 10/4, 1050 Vienna, Austria; University of Natural Resources and Life Sciences, Department of Economics and Social Sciences, Institute for Sustainable Economic Development, Feistmantelstrasse 4, 1180, Vienna, Austria); Wolfgang Koller (Institute for Industrial Research, Mittersteig 10/4, 1050 Vienna, Austria); Bernhard Mahlberg (Institute for Industrial Research, Mittersteig 10/4, 1050 Vienna, Austria; Vienna University of Economics and Business, Welthandelsplatz 1, 1020 Vienna, Austria) |
| Abstract: | This paper investigates the contribution of industrial robots to labor productivity growth and the process of economic convergence in 19 developed and 17 emerging countries in the period 1999 to 2019. To answer our research questions, we extend the non-parametric production frontier framework by considering industrial robots as a separate production factor. Production frontiers and distances to the frontiers are estimated by Data Envelopment Analysis, a method based on linear programming models. Considerable contributions of robotization to labor productivity growth are mainly found in emerging countries and are rather modest in most developed countries. In the period 2009 to 2019 robot capital deepening as a source of productivity growth has gained in importance in emerging countries but not in developed countries. Within the period 1999 to 2019 we find some evidence of i) unconditional β-convergence, ii) a reduction in the dispersion of productivity levels across economies (σ- convergence) and iii) a depolarization (shift from bimodal to unimodal distribution) of the labor productivity distribution. Non-robot physical capital deepening and robotization are the most important drivers of β-convergence. Robot capital deepening contributed to the depolarizationof the labor productivity distribution and to σ-convergence. Though, the effect of robot capital deepening on the entire shift of the labor productivity distribution between 1999 and 2019 is modest and dominated by other growth factors such as technological change and non-robot physical capital deepening. |
| Keywords: | automation, robotization, decomposition, data envelopment analysis, emerging countries, developed countries |
| JEL: | E24 O33 O47 |
| URL: | http://d.repec.org/n?u=RePEc:aso:wpaper:wp0004&r= |
| By: | Messono O. Omang (University of Douala, Douala, Cameroon); Simplice A. Asongu (Yaoundé, Cameroon); Vanessa S. Tchamyou (Yaoundé, Cameroon) |
| Abstract: | This study investigates the effects of historical prevalence of infectious diseases on contemporary sustainable development. Previous studies reveal numerous proximate causes of sustainable development, but little is known about the fundamental determinants of this widespread economic concern. The novelty of this paper lies in the adoption of a historical approach that sheds light on the deep historical roots of cross-country differences in sustainable development. The central hypothesis is that historical pathogens exert persistent impacts on present-day sustainable development. Using Ordinary Least Squares (OLS) and Two Stage Least Squares (2SLS) in cross-section with data from 122 countries between 2000 and 2021, we provide support for the underlying hypothesis. Past diseases reduce sustainable development both directly and indirectly. The strongest indirect effects occur through property rights, innovation, globalization and government effectiveness. This result is robust to many sensitivity tests. Policy makers may take these findings into account and incorporate disease pathogens into the design of international sustainable development. |
| Keywords: | infectious diseases; sustainable development, economic development |
| JEL: | B15 B40 I31 J24 Q01 |
| Date: | 2022–01 |
| URL: | http://d.repec.org/n?u=RePEc:agd:wpaper:22/036&r= |
| By: | Lucas Menescal; José Alves |
| Abstract: | In this empirical study we assess both linear and nonlinear relationship between total taxation and several tax items with real per capita GDP growth rates for 43 developing countries between 1990 and 2019. We use panel data techniques to evaluate the effects of taxation on economic growth for both short and long run perspectives, and to find optimal tax threshold values. We obtain evidence of nonlinear relationships between all tax items, except for corporate income taxation, as well as an optimal value for total tax burden around 23,5% of GDP for the whole sample. When the sample is subdivided by countries’ income levels, we find threshold values for all tax items and an optimal tax burden around 23,6% of GDP for high income countries and 21,3% of GDP for low income. Our results provide support regarding the existence of nonlinearities and about policies focused on raising certain tax revenues, as a percentage of GDP, without hampering economic growth. |
| Keywords: | economic growth, fiscal policy, optimal taxation, tax thresholds |
| JEL: | E62 H21 O47 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9782&r= |
| By: | Erik Stam |
| Abstract: | In this paper we show that a culture of independent entrepreneurship and a culture of ambitious entrepreneurship are two distinct dimensions of culture in entrepreneurial ecosystems, and are differently related to Venture Capital, growth-oriented entrepreneurship and the prevalence of unicorns in a country. We map the different types of entrepreneurship around the globe, and show the extreme spatial unevenness of entrepreneurial outputs of entrepreneurial ecosystems. We analyze the unicorn production chain from Total Entrepreneurial Activity, to growth-oriented entrepreneurship, and unicorns, and how this connects to culture and capital. |
| Keywords: | entrepreneurial ecosystem, entrepreneurship, growth-oriented entrepreneurship, scale-ups, unicorns, venture capital, culture, ambition |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:use:tkiwps:2112&r= |
| By: | Kirill Borissov; Mikhail Pakhnin; Ronald Wendner |
| Abstract: | We consider a neoclassical growth model with quasi-hyperbolic discounting under Kantian optimization: each temporal self acts in a way that they would like every future self to act. We introduce the notion of a Kantian policy as an outcome of Kantian optimization in a given class of policies. We derive and characterize a Kantian policy in the class of policies with a constant saving rate for an economy with log-utility and Cobb–Douglas production technology and an economy with isoelastic utility and linear production technology. In all cases, the Kantian saving rate is higher than the saving rate of sophisticated agents, and a Kantian path Pareto dominates a sophisticated path. |
| Keywords: | quasi-hyperbolic discounting, time inconsistency, Kantian equilibrium, sophisticated agents, saving rate, welfare |
| JEL: | C70 D15 D91 E21 O40 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9790&r= |
| By: | Tran Quang-Thanh |
| Abstract: | Population aging is becoming a prominent issue in Asia, especially for developing countries where demographic changes have asserted a downward pressure on the rate of growth. This paper refers to such potential unwanted effects as an "aging tax" and analytically examines them from a neoclassical perspective, using a Diamond-type overlapping generations model with endogenous retirement, survival rate, and old worker productivity. Based on this setup, negative impacts exist if too many old workers that are sufficiently unproductive choose to defer retirement under the aging pressure, which drains resources from future generations. Numerical simulations show that an aging tax can reduce the potential per capita growth rate (technologyadjusted) by up to 0.12 percentage points annually for some countries in Asia. Our results highlight that countries with sufficiently large labor shares (due to a high ratio of self-employment or a manual labor-centric production) and inadequate educational attainment are potentially the most sensitive and vulnerable to population aging. |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:toh:tupdaa:14&r= |
| By: | Rincón-Zapatero, Juan Pablo |
| Abstract: | In this paper we develop a general framework to analyze stochastic dynamic optimization problems in discrete time. We obtain new results of the existence and uniqueness of solutions to the Bellman equation through a general xed point theorem that generalizes known results for Banach contractions and local contractions. We study an endogenous growth model as well as the Lucas asset pricing model in an exchange economy, signicantly expanding their range of applicability. |
| Keywords: | Stochastic Dynamic Programming; Contraction Mapping; Bellman Equation; Value Function; Endogenous Growth; Asset Pricing Model |
| Date: | 2022–06–29 |
| URL: | http://d.repec.org/n?u=RePEc:cte:werepe:35342&r= |