|
on Economic Growth |
| By: | Pintu Parui (School of Economics, XIM University); Klaus Prettner (Department of Economics, Vienna University of Economics and Business) |
| Abstract: | We propose a generalized R&D-based economic growth model that incorporates i) endogenous human capital accumulation in terms of education and health, ii) endogenous population growth, and iii) the public provision of healthcare and basic science. The government taxes households to pay for healthcare personnel and basic scientists. Since these employees are not anymore available for applied science and for final goods production, important tradeoffs with respect to government spending emerge for economic growth and welfare. We show that increasing public spending, particularly on basic science, leads to faster economic growth in the medium run and tends to raise welfare when compared to actual levels of spending in Organisation for Economic Co-operation and Development (OECD) countries. Our results highlight the difficult tradeoffs associated with public expenditures for healthcare and basic science and emphasize the important role of policymakers in ensuring adequate overall public funding. |
| Keywords: | R&D-Based Growth, Basic Science, Public Healthcare, Children's Health, Education, Fertility, Intertemporal Tradeoffs |
| JEL: | H41 J24 O31 O32 O41 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwwuw:wuwp365&r= |
| By: | Depetris-Chauvin, Emilio; Özak, Ömer (Southern Methodist University) |
| Abstract: | We explore the effect of historical ethnic borders on contemporary conflict in Africa. We document that the intensive and extensive margins of contemporary conflict are higher close to historical ethnic borders. Exploiting variations across artificial regions within an ethnicity's historical homeland and a theory-based instrumental variable approach, we find that regions crossed by historical ethnic borders have 27 percentage points higher probability of conflict and 7.9 percentage points higher probability of being the initial location of a conflict. We uncover several key underlying mechanisms: competition for agricultural land, population pressure, cultural similarity, and weak property rights. |
| Date: | 2024–05–02 |
| URL: | http://d.repec.org/n?u=RePEc:osf:socarx:8uxd4&r= |
| By: | Ken Tabata (School of Economics, Kwansei Gakuin University) |
| Abstract: | This paper analyses the effects of resource taxation policies aimed at sustainable use of resources on economic growth and consumption inequality using an R&D-based growth model with heterogeneous households. Resource taxes affect the extraction rate of non-renewable resources only if the tax rate changes over time. This paper shows that the lower growth rate of the ad valorem tax on resource use slows resource extraction and promotes economic growth but increases consumption inequality. If resource tax policies are to promote economic growth without increasing consumption inequality, resource tax revenues must be allocated for redistributive purposes. This paper also calibrates the model for quantitative analysis and finds that the lower growth rate of the tax on resource use causes a non-negligible increase in consumption inequality. |
| Keywords: | Non-renewable resources, Endogenous growth, Consumption inequality, R&D |
| JEL: | E62 H23 O30 Q32 Q38 |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:kgu:wpaper:272&r= |
| By: | Ozili, Peterson K |
| Abstract: | Economic growth is reflected in SDG8 of the sustainable development goals. Financial stability has been identified as a factor promoting economic growth. However, there is little evidence on the effect of financial stability on economic growth in Nigeria. This study empirically examines the effect of financial stability on economic growth in Nigeria from 1993 to 2017. The results show a positive relationship between financial stability and economic growth in Nigeria. Specifically, the result shows that a high ZSCORE, which reflects low insolvency risk, has a positive effect on economic growth. Similarly, fewer nonperforming loans improve economic growth in Nigeria. In contrast, capital adequacy was found to have a negative effect on economic growth in Nigeria. |
| Keywords: | financial stability, ZSCORE, economic growth, Nigeria |
| JEL: | G20 G21 G23 G28 G29 O43 O47 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:120776&r= |
| By: | Omar Al-Ubaydli; Faith Fatchen; John List |
| Abstract: | Field experiments are a useful empirical tool that can be deployed in any sub-discipline - including institutional economics - to enhance the sub-discipline's empirical insights. However, we here argue that there exist fundamental barriers to the use of field experiments in understanding the impact of institutions on economic growth. Despite these obstacles, we present some significant scholarly contributions that merit exposition, while also proposing some future methods for using field experiments within institutional economics. While field experiments may be limited in answering questions in institutional economics with macroeconomic outcomes, there is great potential in employing field experiments to answer micro founded questions. |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:feb:natura:00787&r= |
| By: | Patrick A. Imam; Jonathan R. W. Temple |
| Abstract: | We investigate the existence of a middle-income trap using finite state Markov chains, constant growth thresholds, and mean passage times. As well as studying output per head, we examine the dynamics of its proximate determinants: TFP, the capital-output ratio, and human capital. We find upwards mobility for the capital-output ratio and human capital, but not for relative TFP. The lack of upwards mobility in relative TFP, at least from an intermediate level, suggests that escaping the middle-income category can take many years, and such traps may become increasingly apparent in the years to come. |
| Keywords: | Economic growth; aggregate development; middle-income trap |
| Date: | 2024–04–26 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:2024/091&r= |
| By: | Nicolas Abad (LERN, University of Rouen Normandy); Johanna Etner (EconomiX, Univ Paris Nanterre,); Natacha Raffin (University Paris-Saclay, ENS Paris-Saclay, Centre for Economics at Paris-Saclay, 91190, Gif-sur-Yvette); Thomas Seegmuller (Aix Marseille Univ, CNRS, AMSE, Marseille, France) |
| Abstract: | We use an overlapping generations model with physical and human capital, and two reproductive periods to explore how fertility decisions may differ in response to economic incentives in early and late adulthood. In particular, we analyze the interplay between fertility choices—related to career opportunities—and wages, and investigate the role played by work experience and investment in both types of capital. We show that young adults postpone parenthood above a certain wage threshold and that late fertility increases with work experience. The long run trend is either to converge to a low productivity equilibrium, involving high early fertility, investment in physical capital and relatively low income, or to a high productivity equilibrium, where households postpone parenthood to invest in their human capital and work experience, with higher late fertility and higher levels of income. A convergence to the latter state would explain the postponement of parenthood and the mitigation or slight reversal of fertility decrease in some European countries in recent decades. |
| Keywords: | fertility, postponement, work experience, overlapping generations |
| JEL: | E21 J11 J13 |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:aim:wpaimx:2416&r= |