nep-gro New Economics Papers
on Economic Growth
Issue of 2022‒09‒12
eleven papers chosen by
Marc Klemp
University of Copenhagen

  1. Flow of Ideas : Economic Societies and the Rise of Useful Knowledge By Cinnirella, Francesco; Hornung, Eric; Koschnick, Julius
  2. Persecution, Pogroms and Genocide: A Conceptual Framework and New Evidence By Sascha O. Becker; Sharun Mukand; Ivan Yotzov
  3. Harrodian Instability: A Marxian Perspective By Chatzarakis, Nikolaos; Tsaliki, Persefoni
  4. Sustained Economic Growth and Physical Capital Taxation in a Creative Region By Batabyal, Amitrajeet; Beladi, Hamid
  5. Economic growth and education in Morocco: Cointegration and Toda Yamamoto Granger Causality By Yassine Jaber; Ismail Kabouri; Mohamed Bouzahzah; Ibourk Aomar; Mohamed Karim
  6. The Impact of Digitalization and Patent on Economic Growth in Romania By Bakari, Sayef
  7. Deep historical roots, culture choice and the New World Order By Miller, Marcus
  8. The Impact of Digitalization and Trade Openness on Economic Growth: New Evidence from Richest Asian Countries By Bakari, Sayef; El Weriemmi, Malek; Mabrouki, Mohamed
  10. A meta-analysis of the total economic impact of climate change By Richard S.J. Tol
  11. Growth, Degrowth or Post-growth? Towards a synthetic understanding of the growth debate By Xhulia Likaj; Michael Jacobs; Thomas Fricke

  1. By: Cinnirella, Francesco (University of Bergamo); Hornung, Eric (University of Cologne); Koschnick, Julius (London School of Economics)
    Abstract: Economic societies emerged during the late eighteenth-century. We argue that these institutions reduced the costs of accessing useful knowledge by adopting, producing, and diffusing new ideas. Combining location information for the universe of 3,300 members across active economic societies in Germany with those of patent holders and World’s Fair exhibitors, we show that regions with more members were more innovative in the late nineteenth-century. This long-lasting effect of societies arguably arose through agglomeration economies and localized knowledge spillovers. To support this claim, we provide evidence suggesting an immediate increase in manufacturing, an earlier establishment of vocational schools, and a higher density of highly skilled mechanical workers by mid-nineteenth century in regions with more members. We also show that regions with members from the same society had higher similarity in patenting, suggesting that social networks facilitated spatial knowledge diffusion and, to some extent, shaped the geography of innovation
    Keywords: Economic Societies ; Useful Knowledge ; Knowledge Diffusion ; Innovation ; Social Networks JEL Classification: N33 ; O33 ; O31 ; O43
    Date: 2022
  2. By: Sascha O. Becker; Sharun Mukand; Ivan Yotzov
    Abstract: Persecution, pogroms, and genocide have plagued humanity for centuries, costing millions of lives and haunting survivors. Economists and economic historians have recently made new contributions to the understanding of these phenomena. We provide a novel conceptual framework which highlights the inter-relationship between the intensity of persecution and migration patterns across dozens of historical episodes. Using this framework as a lens, we survey the growing literature on the causes and consequences of persecution, pogroms, and genocide. Finally, we discuss gaps in the literature and take several tentative steps towards explaining the differences in survival rates of European Jews in the 20th century.
    Keywords: genocide, persecution, migration, immigration restrictions, exit or voice
    JEL: D74 F22 F51 N40 O15 R23
    Date: 2022
  3. By: Chatzarakis, Nikolaos; Tsaliki, Persefoni
    Abstract: The analysis of a sustained long-run equilibrium path of economic growth goes back to Marx’s discussion of the schemes of reproduction and capital accumulation. In this paper, we indicate that the Harrodian ‘knife edge’ instability is a feature of the inner nature of the capitalist mode of production that is explained by the evolution of the rate of surplus-value. A fundamental category in Marx’s analysis, which is not restricted to income distribution, but also has further repercussions, which we grapple with in our analysis. In particular, we argue that the unbalanced economic growth path is the macroeconomic manifestation of the consequent antithesis between productive forces and productive relations formed during the process of capital accumulation and confined by the evolution of the rate of surplus-value.
    Keywords: Economic Growth; Capital Accumulation; Rate of Surplus-Value; Knife-Edge Instability
    JEL: E11 E12 E32 P16
    Date: 2022–07–22
  4. By: Batabyal, Amitrajeet; Beladi, Hamid
    Abstract: We study the properties of economic growth in a region that is driven by the activities of the so-called creative class. On the consumption side of our regional economy, we focus on an infinitely lived creative class household and on the production side of this same economy, we concentrate on a final good that is produced using creative and physical capital. In this setting, we first define and then characterize a competitive equilibrium for our regional economy. Second, we show that this competitive equilibrium is Pareto optimal. Third, we demonstrate that sustained growth in this regional economy is impossible when the value of a key parameter of the production function is less than or equal to unity. Fourth, we specify the conditions in our model that need to hold for there to be sustained economic growth. Fifth, we study what happens to the share of physical capital in our region’s total income. Finally, we analyze what happens to the asymptotic growth rate of physical capital and consumption when a regional authority taxes the returns from physical capital.
    Keywords: Capital Tax, Creative Class, Economic Growth, Pareto Optimality, Sustained Growth
    JEL: H22 O40 R11
    Date: 2022–06–15
  5. By: Yassine Jaber (Mohammed V University of Rabat, Morocco - Faculty of Law, Economics and Social Sciences of Souissi); Ismail Kabouri (Mohammed V University of Rabat, Morocco - Faculty of Law, Economics and Social Sciences of Souissi); Mohamed Bouzahzah (Mohammed V University of Rabat, Morocco - Faculty of Law, Economics and Social Sciences of Souissi); Ibourk Aomar; Mohamed Karim (Mohammed V University of Rabat, Morocco - Faculty of Law, Economics and Social Sciences of Souissi)
    Abstract: This paper aims to investigate the cointegration and causal effect of economic growth and education in the case of Morocco, over the period 1990 to 2019. Education in all of it's forms, considered a fundamental factor of development. Therefore, a country needs to invest more in education. Without a significant investment in education (or human capital), no country can achieve sustainable economic development. Several studies have used various proxies for education, which is the enrollment rate at primary, secondary and tertiary levels (Chatterji, 1998). However, in our study, the quantity dimension of education is proxies by primary, secondary, and tertiary enrolment ratios and an education index. To investigate the relationship between education and economic growth the Auto-regressive Distributed Lag (ARDL) approach developed by Pesaran et al., (2001) and the Augmented Granger Causality approach given by Toda and Yamamoto (1995) are applied. To do that, we have used time-series data on economic growth, labor force, physical capital and four separate education indexes from 1990 to 2019. The data are collected from the World Development Indicators (WDI) and Human Development Reports (HDR). Furthermore, we used a global measure of education, called the education index, by adopting the UNDP methodology. The education index is a proxy for education development. The several indicators were used to demonstrate the robustness of the empirical results. Our results of the ARDL-bound test show that there exist cointegration between economic growth and education. The results also show that there is bidirectional causality between education and economic growth. All levels of education Granger cause economic growth, while economic growth causes all indicators of education except gross enrollment ratio, primary in all cases of causality analysis. These findings suggest that the government should invest in gross primary enrollment to accelerate economic growth, which leads to further education and thus economic growth.
    Keywords: ARDL bounds test,Education index,Gross enrolment ratio,Economic growth,Toda-Yamamoto approach JEL Classification: C5 C22,I25,O4 Paper type: Empirical research
    Date: 2022–06–06
  6. By: Bakari, Sayef
    Abstract: The study aims to investigate the impact of patent and digitalization on economic growth in Romania. Our data was retrieved from the World Development Indicators database (World Bank 2021) from the period 1990-2020. Empirical fundings indicated that digitalization and patent have a positive effect on economic growth. From these perspectives, the Romanian authorities should take seriously the patent and the potential of digitalization which can help the economy to be modernized, diversified, and robust to create new jobs and to find new markets and new strategic partners, and new opportunities.
    Keywords: Digitalization; Patent; Economic Growth; Romania.
    JEL: O31 O32 O33 O34 O38 O47 O52
    Date: 2022
  7. By: Miller, Marcus (University of Warwick, CAGE and CEPR)
    Abstract: Gerard Roland examines data going back to 3,000 BC for historical roots that might explain the current division of nations as between cultures of collectivism and individualism. In response to the appeal for theories bearing on the empirical evidence presented - and of recent moves by Russia and China to create a ‘New World Order’ based on similar cultural division - three contributions are discussed. First is the ‘competing powers’ perspective of Acemoglu and Robinson, who propose that individualism flourishes where power is evenly balanced between the state and the people : otherwise, either Despotism or Disorder will ultimately prevail. Then there is Ken Binmore’s study of cooperative social contracts: this offers support for stable societies of each cultural type, based on the folk theorem of repeated games. Finally the notion that dictatorship may be sustained by deception rather than repression - by leaders whom Guriev and Treisman call ‘spin dictators’. In the light of these perspectives, what to make of the current drive for a new global order that recognizes different ‘spheres of influence’ for each of Roland’s cultural types? We look specifically at the case of Russia.
    Keywords: Individualism ; Collectivism ; Culture ; Social Contracts ; Social preferences ; Neofeudalism ; Despotism ; New World Order. JEL Codes: C70 ; C73 ; N00 ; P00 ; P50 ; Z10 ; Z13
    Date: 2022
  8. By: Bakari, Sayef; El Weriemmi, Malek; Mabrouki, Mohamed
    Abstract: The aim of this investigation is to check the impact of digitalization and trade openness on economic growth for top ten richest Asian countries. Static Gravity Model and Generalized Method of Moments Model were estimated. We found that digitalization and trade openness have a significant positive effect on economic growth. These results prove that trade openness and digitalization is a source of economic growth for richest Asian countries. Due to the magnitude of the positive externalities attached to the trade openness and digitalization, in terms of technology transfer bias, financial capacities, economic policies, human expertise, plenty of natural resources, large markets size, and spillover effect added to the domestic capacities and the national investment, the pace of the phenomenal economic performance of the Asian economies is very well marked.
    Keywords: Digitalization, Trade Openness, Economic Growth, Richest Asian Countries.
    JEL: E22 F10 F11 F13 F14 O16 O33 O47 O53
    Date: 2022
  9. By: Sheilla Nyasha; Nicholas M. Odhiambo
    Abstract: In this paper, we have empirically examined the impact of remittances on economic growth in South Africa over the period from 1970-2019. The study was motivated by the conflicting empirical findings that have emerged in the literature on the impact of remittance on economic growth in various countries. The study was also motivated by the need to find an empirical backing on the assertion that remittances are good for economic growth and can play a key role in lowering the inequality levels in developing countries. Using the autoregressive distributed lag (ARDL) bounds testing approach, the empirical results, contrary to expectations, have revealed that in South Africa, remittances have a negative impact on economic growth, irrespective of whether the regression analysis is conducted in the long run, or in the short run. The study, therefore, cautions policy makers when it comes to policies related to harnessing remittances for economic growth. The study argues that it is not only remittance inflows that matter, but also how the remittances are utilised to influence economic growth.
  10. By: Richard S.J. Tol (University of Sussex)
    Abstract: Earlier meta-analyses of the economic impact of climate change are updated with more data, with three new results: (1) The central estimate of the economic impact of global warming is always negative. (2) The confidence interval about the estimates is much wider. (3) Elicitation methods are most pessimistic, econometric studies most optimistic. Two previous results remain: (4) The uncertainty about the impact is skewed towards negative surprises. (5) Poorer countries are much more vulnerable than richer ones. A meta-analysis of the impact of weather shocks reveals that studies, which relate economic growth to temperature levels, cannot agree on the sign of the impact whereas studies, which make economic growth a function of temperature change do agree on the sign but differ an order of magnitude in effect size. The former studies posit that climate change has a permanent effect on economic growth, the latter that the effect is transient. The impact on economic growth implied by studies of the impact of climate change is close to the growth impact estimated as a function of weather shocks. The social cost of carbon shows a similar pattern to the total impact estimates, but with more emphasis on the impacts of moderate warming in the near and medium term. Keywords: climate change; weather shocks; economic growth; social cost of carbon
    Keywords: Climate change; weather shocks; economic growth; social cost of carbon
    JEL: D24 O44 O47 Q54
    Date: 2022–08–27
  11. By: Xhulia Likaj (Forum New Economy); Michael Jacobs (University of Sheffield (SPERI)); Thomas Fricke (Forum New Economy)
    Abstract: Arguments about the possibility and desirability of exponential economic growth have animated the environmental movement for half a century, since the publication of the Club of Rome report The Limits to Growth in 1972. The debate has been revived in recent years as the climate crisis has reached centre-stage. This paper seeks to unpick the different strands in the debate and the different kinds of arguments - philosophical, empirical, and policy-prescriptive - used by different writers and institutions. It suggests that the contemporary debate is best understood as a disagreement between political strategies, in which the character of public and academic discourse plays a key role.
    Keywords: economic growth, green growth, degrowth, post-growth, wellbeing, GDP
    JEL: O4 O44 Q56
    Date: 2022–05

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