nep-gro New Economics Papers
on Economic Growth
Issue of 2023‒02‒20
six papers chosen by
Marc Klemp
University of Copenhagen

  1. Is Democracy Good for Growth? | Development at Political Transition Time Matters By Sima, Di; Huang, Fali
  2. Macroeconomics of aging By Betti, Thierry; Lefebvre, Mathieu; Pestieau, Pierre
  3. How many people on earth? World population 1800-1938 By Federico, Giovanni; Tena Junguito, Antonio
  4. Global Innovation Contests By Elias Dinopouulos; Constantinos Syropoulos; Theofanis Tsoulouhas
  5. The Contribution of Industries over Sixty Years of Economic Growth in South Korea By Gil, Eunsun
  6. Demographic Change and Economic Development in India By Neha Jain; Srinivas Goli

  1. By: Sima, Di (Nanjing Audit University); Huang, Fali (Singapore Management University)
    Abstract: Is democracy a better political regime for economic prosperity than autocracy? This paper shows that the answer depends on the initial economic development level during the democratic transition when the foundation of institutions was laid. Democracy fa-cilitates growth only in countries that already have adequate development at transition time. These countries are more likely to create and sustain growth-enhancing insti-tutions than others. Without appropriate development, democracy does not improve growth; this applies to about 40% of the third-wave democratized countries. These results are based on a sample of 153 countries in 1960-2010 and robust to various spec-ifications and endogeneity issues.
    Keywords: Democracy; Growth; Economic Development; Institutions; Critical Junc-ture; Democratization; Modernization; Human Capital.
    JEL: D73 E02 I25 O10 O43 P16 P48
    Date: 2022–11–27
  2. By: Betti, Thierry; Lefebvre, Mathieu; Pestieau, Pierre (Université catholique de Louvain, LIDAM/CORE, Belgium)
    Abstract: The purpose of this chapter is to analyze the effects that population aging, and specifically the increase in longevity, may have on capital accumulation and the welfare of society. Throughout our analysis, we use as back bone a two-period overlapping generation model with variable longevity, distinguishing between the case when longevity increase is exogenous and the case when it is endogenous, namely partially the responsibility of individuals or governments. In each section, we first provide the result arising from our central model and then review the relevant literature. Keywords: Longevity, OLG models, Capital accumulation.
    Keywords: Longevity ; OLG models ; Capital accumulation
    JEL: H55 I12 I13 J10 J11
    Date: 2023–01–01
  3. By: Federico, Giovanni; Tena Junguito, Antonio
    Abstract: The number of people is one of the most basic information about any society but it is difficult to know it. The data are missing for most of human history and scarce and/or hardly reliable for advanced countries until the early 19th century and for the rest of the world until the mid-20th century. Yet, historical demographers have tried hard and often successfully to estimate population in the past, but their results have often been neglected in the most common general historical data-bases. Thus, we do not have a continuous series of world population at least until World War One if not until 1950. In this paper we fill this gap by re-estimating series of population for all polities from 1800 to 1938 using first-hand sources and country-specific literature. We use our series to address two issues which have attracted some attention by economist and economic historians in the last years, the start of the demographic transition and the impact of major demographic crises such as the Tai'ping civil war, World War One and the Spanish flu.
    Keywords: World Population Dataset; Demographic Transition
    JEL: I10 J11 J13
    Date: 2023–01–31
  4. By: Elias Dinopouulos; Constantinos Syropoulos; Theofanis Tsoulouhas
    Abstract: This paper develops a two-country, dynamic general equilibrium model with innovation contests to study the impact of globalization on the skill premium and fully-endogenous growth. Higher quality products are endogenously discovered through stochastic and sequential global innovation contests in which challengers devote resources to R&D to discover new products while technology leaders undertake rent-protection activities (RPAs) to prolong the expected duration of their temporary monopoly power by hindering the R&D effort of challengers. The model generates intra-sectoral trade, multinationals, and international outsourcing of investment services. Globalization, captured by a move from autarky to the integrated-world equilibrium, leads to convergence of wages and growth rates. Globalization and long-run growth are either substitutes or complements depending on a country’s relative skill abundance and the ranking of skill intensities between RPAs and R&D services. Trade openness between two countries that possess identical relative skill endowments but differ in size does not affect either country’s long-run growth.
    Keywords: innovation contests, economic growth, scale effects, R&D, rent-protection activities, barriers to innovation, wage premium
    JEL: F10 F30 F40
    Date: 2023
  5. By: Gil, Eunsun (Korea Institute for Industrial Economics and Trade)
    Abstract: This article reassesses the contribution of industry over 60 years of economic growth in South Korea. The study bases its analysis using one-digit level industrial classification codes used in national GDP accounts, and analyzes the patterns of industrial concentration of growth by looking at five-digit level industrial classification for the most recent 10 years. Based on the historical evidence of economic growth in South Korea, the findings of the work carry five key implications for for economic growth from an industrial policy perspective. It is possible that future economic growth patterns may be totally different with those of the past, but learning from history offers some insight to policy makers seeking to design a realistic roadmap for continued economic prosperity.
    Keywords: economic growth; industrial policy; Korea; growth policy; GDP growth
    JEL: E61 L52 L60
    Date: 2021–10–01
  6. By: Neha Jain (Indian Institute of Foreign Trade (IIFT), New Delhi); Srinivas Goli (International Institute for Population Sciences (IIPS), Mumbai, India.)
    Abstract: In this paper, we assess the economic benefits of demographic changes in India by employing econometric models and robustness checks based on panel data gathered over a period of more than three decades. Our analysis highlights four key points. First, India’s demographic window of opportunity began during 2001-05 and significantly improved after 2011. Second, the demographic dividend is estimated to be about 1.9 percentage points per annum for the period 1981–2015 based on the panel of 25 states of India. Third, our empirical analysis supports the argument that the realisation of the demographic dividend is conditional on a conducive policy environment with enabling aspects such as quality education, good healthcare, decent employment opportunities, good infrastructure, and gender empowerment. Fourth, the working-age population in India contributes around one-fourth of the inequality in per capita income across states. Thus, to reap the maximum dividends from the available demographic window of opportunity, India needs to work towards enhancing the quality of education and healthcare in addition to providing good infrastructure, gender empowerment, and decent employment opportunities for the growing working-age population.
    Keywords: Demographic Dividend, Economic Development, Population Growth, Working-Age Population, Health, Education, Employment
    JEL: J10 J11
    Date: 2022

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