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on Economic Growth |
| By: | Lukas Rosenberger; W. Walker Hanlon; Carl Hallmann |
| Abstract: | How did Britain sustain faster rates of economic growth than comparable European countries, such as France, during the Industrial Revolution? We argue that Britain possessed an important but underappreciated innovation advantage: British inventors worked in technologies that were more central within the innovation network. We offer a new approach for measuring the innovation network using patent data from Britain and France in the late-18th and early-19th century. We show that the network influenced innovation outcomes and demonstrate that British inventors worked in more central technologies within the innovation network than French inventors. Drawing on recently developed theoretical tools, and using a novel estimation strategy, we quantify the implications for technology growth rates in Britain compared to France. Our results indicate that the shape of the innovation network, and the location of British inventors within it, explains an important share of the more rapid technological change and industrial growth in Britain during the Industrial Revolution. |
| JEL: | N13 O30 |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:32875 |
| By: | Heng-fu Zou (The World Bank) |
| Abstract: | Deirdre McCloskey's argument in favor of what she calls humanomics emphasizes the role of novel ideas about liberty and dignity for ordinary people as the driving force behind what she terms "The Great Enrichment." This period of unprecedented economic growth, beginning in the 18th century and continuing into the present, was not primarily driven by capital accumulation or institutional frameworks, but by the widespread social acceptance of bourgeois values that encouraged innovation and entrepreneurship among the masses. |
| Date: | 2024–08–24 |
| URL: | https://d.repec.org/n?u=RePEc:cuf:wpaper:659 |
| By: | Sasaki, Hiroaki |
| Abstract: | This study builds a Kaleckian model that incorporates endogenous technological progress and investigates how a change in a parameter that directly fosters technological progress affects growth and distribution. In this model, there is an optimal wage share that maximizes the technological progress rate. Accordingly, if the actual wage share can be moved to an optimal level, the economic growth rate will increase. This analysis reveals that a policy that directly promotes technological progress consequently decreases the long-run equilibrium value of the wage share, the capacity utilization rate, the employment rate, and the economic growth rate. |
| Keywords: | endogenous technological progress; education; R\&D; growth and distribution |
| JEL: | E11 E12 E24 E25 O33 O41 |
| Date: | 2024–08–12 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:121694 |
| By: | Linda Kadriji (South East European University, North Macedonia, Faculty of Business and Economics) |
| Abstract: | The main objective of this paper is to empirically investigate the impact of income inequality on economic growth and its determinants in transition countries (Albania, Kosovo, Serbia, Hungary, Estonia, Czech Republic, Poland, Russia, and North Macedonia) during the period 2000-2020. This research employs econometric methods, including Ordinary Least Squares (OLS) with robust standard errors, random and fixed effects models, and the Hausman-Taylor model with instrumental variables (IV). The findings from this empirical research highlight two key conclusions: first, that reducing income inequality positively influences economic growth; and second, that subsidies and transfers play a crucial role in decreasing income inequality, which in turn fosters economic growth in transition countries. |
| Keywords: | sGini index, economic growth, subsidies and transfers |
| JEL: | B41 D63 H20 |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:sko:wpaper:bep-2024-04 |
| By: | Churchill, Sefa Awaworyi (RMIT University); Chang, Simon (University of Western Australia); Smyth, Russell (Monash University); Trinh, Trong-Anh (World Bank) |
| Abstract: | This paper extends prior theory linking present-day sex ratios to present-day propensity for entrepreneurship among men backward in time to explore the long-run gender origins of entrepreneurship. We argue that present-day propensity for entrepreneurship among men will be higher in neighbourhoods which had historically high sex ratios. We propose that high sex ratios generate attitudes and behaviours that imprint into cultural norms about gender roles and that vertical transmission within families create hysteresis in the evolution of these gender norms. To empirically test the theory, we employ the transport of convicts to the British colonies of New South Wales and Van Diemen's Land in the eighteenth and nineteenth centuries as a natural experiment to examine the long-run effect of gender norms on entrepreneurship in present-day Australia. We use a representative longitudinal dataset for the Australian population that provides information on the neighbourhood in which the participant lives, which we merge with data on the sex ratio in historical counties from the mid-nineteenth century. We find that men who live in neighbourhoods which had high historical sex ratios have a higher propensity for entrepreneurship. We present evidence consistent with the vertical transmission of gender norms within families being the likely mechanism. Arguments for policies to promote female entrepreneurship are typically couched in terms of gender norms representing a barrier to more women starting their own business. We present evidence consistent with gender norms contributing to gender differences in rates of entrepreneurship by being a spur for higher male entrepreneurship rather than a barrier to female entrepreneurship. |
| Keywords: | gender norms, sex ratios, entrepreneurship, Australia |
| JEL: | I31 J21 J22 N37 O10 Z13 Z18 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17170 |
| By: | Dirk Krueger; Fulin Li; Harald Uhlig |
| Abstract: | This paper characterizes the transition dynamics of a continuous-time neoclassical production economy with capital accumulation in which households face idiosyncratic income risk and cannot commit to repay their debt. Therefore, even though a full set of contingent claims that pay out conditional on the realization of idiosyncratic shocks is available, the equilibrium features imperfect insurance and a non-degenerate cross-sectional consumption distribution. When household labor productivity takes two values, one of which is zero, and the utility function is logarithmic, we characterize the entire transition dynamics induced by unexpected technology shocks, including the evolution of the consumption distribution, in closed form. Thus, the model constitutes an analytically tractable alternative to the standard incomplete markets general equilibrium Aiyagari (1994) model by retaining its physical environment, but replacing the incomplete asset markets structure with one in which limits to consumption insurance emerge endogenously due to limited commitment. |
| JEL: | D11 E21 G22 |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:32880 |
| By: | Fajardo Baquero, Nicolás (Universidad de los Andes) |
| Abstract: | International Environmental Agreements (IEAs) have been proposed as means to encourage green technological transfers between advanced and emerging economies, thereby promoting a global energy transition. This paper presents an endogenous growth model featuring two economies: a North representing a technological leader, and a South being its follower with the possibility of copying the Northern technologies. In addition to the standard technological flows, North and South can engage in cooperative negotiations to ease green technological transfers. I find that technological transfers are able to revert the path dependency in the South. Further, unconditional agreements reducing Northern technologies’ costs can immediately induce a global energy transition if (i) the North follows a clean growth path, and if (ii) Northern technologies are advanced enough. Otherwise, to ensure a global energy transition, the agreement must be coupled with additional policies encouraging clean innovations. |
| Keywords: | Climate change; Energy transition; International technology transfer; International agreements; Directed technical change |
| JEL: | F18 O31 O41 Q54 Q55 |
| Date: | 2024–08–23 |
| URL: | https://d.repec.org/n?u=RePEc:col:000089:021187 |
| By: | Sasaki, Hiroaki; Mizutani, Aya |
| Abstract: | This study presents a three-sector growth model that consists of manufacturing, private services, and public services, and examines the relationship between sectoral compositions and the tax rate. We identify an optimal tax rate that maximizes instantaneous utility. The optimal tax rate increases as manufacturing productivity increases, though it converges to a certain level that is less than unity. |
| Keywords: | public services; cost disease; optimal tax rate; growth disease |
| JEL: | H21 H40 H50 O14 O41 |
| Date: | 2024–08–12 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:121693 |