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on Economic Growth |
| By: | Cotte Poveda, Alexander; Rangel, Alejandro; Pardo, Clara |
| Abstract: | The analysis of economic growth determinants has allowed for the development of an extensive body of literature that has recognized the role of human capital as the main explanatory variable of countries' economic growth. However, the evidence shows that this relationship does not always occur in such a precise way; therefore, it is necessary to analyse the dynamics of each economy. In Colombia, although there is empirical evidence that correlates these two variables, economic growth and human capital, there is little research that explains the behaviour of growth and human capital expected in the long term. The objective of this research was to determine the interactions between human capital and economic growth in long-term dynamics in Colombia. To achieve this goal, a dynamic stochastic general equilibrium (DSGE) model was applied with parameters calibrated from empirical evidence in Colombia. On the other hand, a vector error correction model (VECM) was applied to the student-teacher ratio series and per capita GDP in Colombia for the 1970–2019 period. The results of the DSGE model indicate that economic growth has a positive effect in the long term. These results are reinforced through the VECM. Disturbances in the productivity of education captured through the student–teacher ratio in tertiary education show the existence of short- and long-term relationships of the mentioned variable with per capita GDP, as in the DSGE model, the variables perceive convergence to new equilibria. Both models indicate that long-term physical capital and human capital have positive relationships with economic growth. |
| Keywords: | Economic growth, Human capital, Colombia, Education, Dynamic stochastic general equilibrium, Vector error correction |
| JEL: | O10 O40 |
| Date: | 2025–09–11 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:126166 |
| By: | Wim Naudé (RWTH Aachen University & University of Coimbra, CeBER) |
| Abstract: | This paper provides a non-technical and selective explanation of the theory of innovation and economic growth, in light of the 2025 Bank of Sweden Prize in Memory of Alfred Nobel, awarded to Joel Mokyr, Philippe Aghion, and Peter Howitt. Their body of scholarship is critically evaluated, and the useful, less useful, and most problematic aspects are highlighted. The verdict is that it is largely a collection of anthropocentric stories of innovation and growth. It avoids spelling out why sustained growth is desirable, it reduces innovation’s ultimate goal to the pursuit of economic growth, it is based on a deep-seated notion of human exceptionalism, and it promotes directed technical change - based on the assumption that all resources are fungible and can be substituted - as a way to sustain economic growth without causing environmental destruction. Their analysis of growth is useful for highlighting the importance of scientific knowledge, for showing that creative destruction can be more destructive than creative, and that economic growth will only be sustained under very special conditions. However, the failure to satisfactorily address energy in innovation and growth remains a glaring gap in modern economic growth theory. For economics to become more useful, it would require becoming an Earth Systems Science based on biocentric holism. |
| Keywords: | Innovation, economic growth, technology, sustainability, energy |
| JEL: | O31 O33 J11 J24 |
| Date: | 2026–02 |
| URL: | https://d.repec.org/n?u=RePEc:gmf:papers:2026-03 |
| By: | Pau Roldan-Blanco; Tom Schmitz; Christian Fons-Rosen |
| Abstract: | Innovative startups are frequently acquired by large incumbents. Such acquisitions have recently come under scrutiny, as policymakers suspect that incumbents might acquire startups just to "kill" their ideas. However, acquisitions also provide an incentive for startup creation, and have ambiguous effects on incumbents' own innovation. This paper assesses the net effect of these forces. To do so, we build an endogenous growth model with heterogeneous multi-product firms and startup acquisitions, and calibrate its parameters to match micro-level evidence from the United States. Our calibrated model implies that taxes on startup acquisitions lower the startup rate, but increase incumbent innovation as well as the implementation rate of startup ideas. Banning killer acquisitions, a policy that appears desirable in partial equilibrium, yields virtually no welfare gains in general equilibrium. The optimal policy instead imposes high taxes on startup acquisitions (reducing their frequency by more than half) and raises consumption-equivalent welfare by 0.48%. |
| Keywords: | acquisitions, firm dynamics, innovation, Productivity Growth |
| JEL: | O30 O41 E22 |
| Date: | 2026–02 |
| URL: | https://d.repec.org/n?u=RePEc:bge:wpaper:1560 |
| By: | Bouzahzah, Mohamed |
| Abstract: | Digitalization boosts economic performance, but its returns vary widely across countries. This paper shows that culture - measured via a World Values Survey index of effort, success, and technological openness - acts as a threshold moderator: internet usage raises log GDP per capita by 0.021 below the cultural threshold (-0.37) vs. 0.033 above it, using 55-country averages (2017-2024). Threshold regressions and quantiles reveal stronger effects in high-culture regimes and upper income quantiles, extending Haller (2024) globally with non-linearities. Results are robust across digitalization proxies (internet, fixed broadband, mobile cellular), implying infrastructure alone fails without cultural readiness for innovation. |
| Keywords: | Digitalization, Culture, Threshold Effects, Economic Growth |
| JEL: | O33 O47 Z10 |
| Date: | 2026–01 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:127839 |
| By: | Bai Yu; Li Yanjun; Liu Xinyan |
| Abstract: | Little is known about the historical origins of political instability, and systematic empirical evidence remains limited. This paper addresses this gap by examining the historical determinants of political instability through the lens of the millennia-long centralized authoritarian monarchy in imperial China. Exploiting proximity to imperial capitals as a proxy for the strength of centralized statehood, we show that counties historically exposed to stronger and more persistent state penetration exhibit significantly lower levels of political instability today, as reflected in a lower incidence of anti-government protests. Our results further suggest that cultural transmission, rather than sustained development, demographic change, or institutional continuity, is the primary channel through which the legacy of long-defunct institutions endures. |
| URL: | https://d.repec.org/n?u=RePEc:toh:tupdaa:79 |