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on Economic Growth |
| By: | Patrick A. Imam; Jonathan R. W. Temple |
| Abstract: | Can high levels of state capacity protect countries from slow growth and deepening output collapses? Using data for 108 developing countries, we classify five-year periods using a two- dimensional state space based on growth regimes and levels of state capacity. We model transitions between them using a finite state Markov chain, and then extend this to take political institutions into account. We find that high state capacity helps to sustain growth and limit output collapses, but these effects are sometimes less striking than the benefits of democracy. |
| Keywords: | Economic growth; state capacity; autocracy; democracy |
| Date: | 2025–01–17 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imfwpa:2025/014 |
| By: | Ghizlen Ouasbaa (TecnoCampus University Center & IEB) |
| Abstract: | This paper examines the lasting impact of tourism specialization on per capita income in Spanish municipalities, aiming to understand the factors driving these effects. We employ two distinct approaches. The first one focuses on tourism development since the initial boom in the 1960s and relies on cross-sectional variation in tourism exposure related to amenities like beaches and weather for identification. The second method looks at a later wave of tourism development in the 1990s, using a shiftshare analysis that combines the share of residents from tourist-source countries in each municipality with the growth rate of tourists from these countries throughout Spain. The findings indicate that municipalities with the highest growth in tourism specialization now exhibit lower per capita income. A municipality experiencing an increase in tourism per capita over time equal to the sample median has a per capita income between 21% and 22% lower as of 2019, depending on the approach used. This decline in income is associated with an increase in temporary job contracts, with a decrease in industrial employment, and with lower levels of educational attainment. |
| Keywords: | Tourism specialization, local economic growth, long-term effects, local labor markets. |
| JEL: | R11 R23 Z32 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ieb:wpaper:doc2024-14 |
| By: | Costa, Dora L. (UCLA); Bygren, Lars Olov (Karolinska Institutet); Graf, Benedikt (NBER); Karlsson, Martin (University of Duisburg-Essen); Price, Joseph (Brigham Young University) |
| Abstract: | Explanations for the West's escape from premature mortality have focused on chronic malnutrition or income and on public health or state capacity. We argue that by ignoring the multigenerational effects of variance in ancestors' harvests, we are underestimating the contribution of modern economic growth to the escape from early death at older ages. Using a newly constructed multigenerational dataset for Sweden, we show that grandsons' longevity was strongly linked to spatial shocks in paternal grandfathers' yearly harvest variability when agricultural productivity was low and market integration was limited. We reason that an epigenetic mechanism is the most plausible explanation for our findings. We posit that the removal of trade barriers, improvements in transportation, and agricultural innovation reduced harvest variability. We contend that for older Swedish men (but not women) born 1830-1909 this reduction was as important as decreasing contemporaneous infectious disease rates and more important than eliminating exposure to poor harvests in-utero. |
| Keywords: | intergenerational transmission, longevity, ecomomic growth, harvest variability |
| JEL: | I15 J11 N33 |
| Date: | 2025–01 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17620 |
| By: | Casey O. Barkan |
| Abstract: | It is widely assumed that increases in economic productivity necessarily lead to economic growth. In this paper, it is shown that this is not always the case. An idealized model of an economy is presented in which a new technology allows capital to be utilized autonomously without labor input. This is motivated by the possibility that advances in artificial intelligence (AI) will give rise to AI agents that act autonomously in the economy. The economic model involves a single profit-maximizing firm which is a monopolist in the product market and a monopsonist in the labor market. The new automation technology causes the firm to replace labor with capital in such a way that its profit increases while total production decreases. The model is not intended to capture the structure of a real economy, but rather to illustrate how basic economic mechanisms can give rise to counterintuitive and undesirable outcomes. |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2411.15718 |
| By: | Pérez Velilla, Alejandro (University of California, Merced); Beheim, Bret; Smaldino, Paul E. |
| Abstract: | We use cultural evolutionary models to examine how individual experiences and culturally-inherited information jointly shape risk attitudes under environmental uncertainty. We find that learning processes not only generate plausible variation in risk attitudes, but also that conservative learning strategies---emphasizing the preservation of generational knowledge---excel in high-risk environments, promoting stable wealth accumulation and long-term survival but limiting asset growth as conditions improve. In contrast, exploratory learning strategies---leveraging risk-free juvenile exploration and peer influence---foster risk-tolerant attitudes that thrive in affluent, low-risk settings where wealth buffers and social safety nets reduce the costs of miscalculations. Introducing economic stratification to the model reveals how wealth disparities and inter-class interactions reinforce these patterns, exacerbating differences in learning strategies and risk-taking behaviors, and perpetuating socioeconomic inequalities through the cultural inertia of excessive risk aversion. By uniting developmental, social, and evolutionary perspectives, our framework provides a novel lens on the cultural evolution of risk attitudes and their broader societal implications. |
| Date: | 2025–01–24 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:9yjes |