Long‐Run Growth Differences and the Neoclassical Growth Model

Maynard, Norman

doi:10.1111/roiw.12179

Cited by 4 publications

(3 citation statements)

References 30 publications

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“…That is, capital accumulation appears to be a crucial factor in pushing an economy up to a higher income level, whether it is from a low-or a middle-income group. This result is consistent with Maynard (2015). A crucial assumption under the neoclassical growth theory is that physical capital exhibits diminishing marginal returns, such that capital accumulation could not sustain long-term growth.…”

Section: Analysis Of Resultssupporting

confidence: 87%

Economic Convergence, Capital Accumulation, and Income Traps: Empirical Evidence

Park

Mercado²

2018

Review of Income and Wealth

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This paper examines the factors that increase the likelihood of economic transition to higher income status, thereby attempting to answer the question of why some economies move to a higher income country group while others do not. Using a quintile income distribution approach, we identify 62 economies that moved to a higher quintile income group in each decade from 1960s to the 2010s out of a sample of 182 economies. Our findings show that higher physical and human capital growth and oil revenues are significantly associated with a greater probability of transitioning to higher quintile income group, although their effects vary not only across income groups within a sample period but also across different periods. Our results indicate that economies that have attained substantial capital accumulation (either physical or human, or combination thereof) and/or are blessed with natural resources have avoided income traps and demonstrated a successful and often steady transition to higher income groups.JEL Codes: O10, O11, O40

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Section: Analysis Of Resultssupporting

confidence: 87%

Economic Convergence, Capital Accumulation, and Income Traps: Empirical Evidence

Park

Mercado²

2018

Review of Income and Wealth

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“…This viewpoint was established by Malthus in 1798; for instance, population growth tends to outpace production growth [32]. Optimistic opinion (neoclassical view) asserts that an increase in population affects economic growth by increasing the labor supply [33,34]. Consequently, population growth has a positive effect on the economy through the provision of labor; an increase in population encourages competition, which fosters innovation, competition, and technological advancement (among others, Bucci [35]).…”

Section: Literature Reviewmentioning

confidence: 99%

The Long-Run Relationship Between Renewable Energy Consumption, Non-Renewable Energy Consumption, Population, and Economic Growth in G20 Countries

Sijabat

2024

IJSDP

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This study examines the impacts of renewable and non-renewable energy consumption, urban population, and population size on economic growth. This study utilizes the Panel Unit Root Test, Pedroni's Residual-based Cointegration Test, and Fully Modified Ordinary Least Square (FMOLS) techniques to analyze data from 2010 to 2021 for 19 countries within the Group of Twenty (G20). The cointegration test indicates that renewable energy consumption, nonrenewable energy consumption, urban population, and total population are long-term associated with GDP growth. According to FMOLS estimates, renewable energy consumption has a positive impact on GDP growth in G20 countries. The impact of renewable energy consumption on GDP growth varies; natural gas consumption does not affect GDP growth, but petroleum consumption significantly affects GDP growth in G20 countries. Furthermore, the study identifies the urban population as a control variable that harms GDP growth. The empirical evidence derived from this study posits that it would be judicious for G20 policymakers to proactively institute a suite of policies that invigorate the advancement of renewable energy sources, given that such a course of action has been demonstrated to engender a notable augmentation in GDP growth.

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“…This is the case for the Food, Beverages and Tobacco sector in the UK for the year 2003 (23 percent), the sector Hotels and restaurants in Germany for all the years considered (27 percent on average) and for the same sector in the UK for 2006 (23 percent). In the UK also the sector Private Households with Employed Persons displays a 22 percent share of migrants in 2006.10 Other shortcomings, from the use of the growth of computed Total Factor Productivity, depend on underlying assumptions about the presence of constant returns to scale in the economy (see alsoMaynard, 2016) and from the adoption of the Euler Theorem according to which the overall compensation of labor and capital equals its marginal productivity. Notwithstanding all these simplifying assumptions TFP growth still remains a good proxy for the share of growth of a firm, country or region which does not depend on the increase of standard productive inputs, and hence is typically associated with innovation.11 This is especially important for our study that covers the full range of economic sectors.…”

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confidence: 99%

Foreign Human Capital and Total Factor Productivity: A Sectoral Approach

Fassio

Kalantaryan

Venturini

2019

Review of Income and Wealth

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We analyze the role of migrants in productivity growth in the three largest European countries—France, Germany and the United Kingdom—in the years 1994–2007, using Total Factor Productivity. Unlike previous research, which mainly employs a regional approach, our analysis is at the sectoral level: this allows to distinguish the real contribution of migrants to productivity from possible inter‐sectoral complementarities, which might also foster growth. We control for the share of migrants and the different components of human‐capital, such as education, age and diversity, and adopt instrumental variables strategies to address the possible endogeneity of migration. The results show that migrants contribute to the productivity of the sectors in which they are employed, but with important differences: highly‐educated migrants show a larger positive effect in high‐tech sectors, and to a lesser extent in services sector. The diversity of countries of origin contributes to productivity growth only in the services sectors.

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Long‐Run Growth Differences and the Neoclassical Growth Model

Cited by 4 publications

References 30 publications

Economic Convergence, Capital Accumulation, and Income Traps: Empirical Evidence

Economic Convergence, Capital Accumulation, and Income Traps: Empirical Evidence

The Long-Run Relationship Between Renewable Energy Consumption, Non-Renewable Energy Consumption, Population, and Economic Growth in G20 Countries

Foreign Human Capital and Total Factor Productivity: A Sectoral Approach

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