Reducing Income Inequality While Boosting Economic Growth: Can It Be Done? Evidence From Oecd Countries

Hoeller, Peter; Joumard, Isabelle; Koske, Isabell

doi:10.1142/s0217590814500015

Cited by 23 publications

(18 citation statements)

References 10 publications

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“…Dabla-norris and Kochhar (2015) show that low-income households and small firms face difficulties in accessing financial services, which decreases economic growth. Hoeller et al (2014) argue that the lack of policies that provide more inclusive access to education, financial services, and labor markets leads to income inequality, and eventually lower economic growth.…”

Section: Institutionsmentioning

confidence: 99%

Productivity Growth: Patterns and Determinants across the World

Kim

Loayza

2019

ECONOMIA

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This is the background paper for the productivity extension of the World Bank's Long-Term Growth Model (LTGM). Based on an extensive literature review, the paper identifies the main determinants of economic productivity as innovation, education, market efficiency, infrastructure, and institutions. Based on underlying proxies, the paper constructs indexes representing each of the main categories of productivity determinants and, combining them through principal component analysis, obtains an overall determinant index. This is done for every year in the three decades spanning 1985-2015 and for more than 100 countries. In parallel, the paper presents a measure of total factor productivity (TFP), largely obtained from the Penn World Table, and assesses the pattern of productivity growth across regions and income groups over the same sample. The paper then examines the relationship between the measures of TFP and its determinants. The variance of productivity growth is decomposed into the share explained by each of its main determinants, and the relationship between productivity growth and the overall determinant index is identified. The variance decomposition results show that the highest contributor among the determinants to the variance in TFP growth is market efficiency for Organisation for Economic Cooperation and Development countries and education for developing countries in the most recent decade. The regression results indicate that, controlling for country-and time-specific effects, TFP growth has a positive and significant relationship with the proposed TFP determinant index and a negative relationship with initial TFP. This relationship is then used to provide a set of simulations on the potential path of TFP growth if certain improvements on TFP determinants are achieved. The paper presents and discusses some of these simulations for groups of countries by geographic region and income level. In addition, as a country-specific illustration, the paper presents simulations on the potential path of TFP growth for Peru under various scenarios. An accompanying Excelbased toolkit, linked to the LTGM, provides a larger set of simulations and scenario analysis at the country level for the next few decades.

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Section: Institutionsmentioning

confidence: 99%

Productivity Growth: Patterns and Determinants across the World

Kim

Loayza

2019

ECONOMIA

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Section: Institutionsmentioning

confidence: 99%

Productivity Growth: Patterns and Determinants “Across” the World

Kim

Loayza

2019

ECONOMIA

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This is the background paper for the productivity extension of the World Bank's Long-Term Growth Model (LTGM). Based on an extensive literature review, the paper identifies the main determinants of economic productivity as innovation, education, market efficiency, infrastructure, and institutions. Based on underlying proxies, the paper constructs indexes representing each of the main categories of productivity determinants and, combining them through principal component analysis, obtains an overall determinant index. This is done for every year in the three decades spanning 1985-2015 and for more than 100 countries. In parallel, the paper presents a measure of total factor productivity (TFP), largely obtained from the Penn World Table, and assesses the pattern of productivity growth across regions and income groups over the same sample. The paper then examines the relationship between the measures of TFP and its determinants. The variance of productivity growth is decomposed into the share explained by each of its main determinants, and the relationship between productivity growth and the overall determinant index is identified. The variance decomposition results show that the highest contributor among the determinants to the variance in TFP growth is market efficiency for Organisation for Economic Co-operation and Development countries and education for developing countries in the most recent decade. The regression results indicate that, controlling for country-and time-specific effects, TFP growth has a positive and significant relationship with the proposed TFP determinant index and a negative relationship with initial TFP. This relationship is then used to provide a set of simulations on the potential path of TFP growth if certain improvements on TFP determinants are achieved. The paper presents and discusses some of these simulations for groups of countries by geographic region and income level. In addition, as a country-specific illustration, the paper presents simulations on the potential path of TFP growth for Peru under various scenarios. An accompanying Excelbased toolkit, linked to the LTGM, provides a larger set of simulations and scenario analysis at the country level for the next few decades.

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“…In the United States, Blacks and Latinos have lower levels of education and are more likely to work in low-skilled occupations when compared with Whites (Gabe, Abel, & Florida, 2018; Nettles, 2017), making some racial/ethnic minorities especially vulnerable to job loss due to automation. It should be noted that technological advances may exacerbate income inequality as higher skilled workers are more likely to benefit (Hoeller, Joumard, & Koske, 2014).…”

Section: Introductionmentioning

confidence: 99%

Problem-Solving Skills of the U.S. Workforce and Preparedness for Job Automation

et al. 2019

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Automation and advanced technologies have increased the need for a better understanding of the skills necessary to have a globally competitive workforce. This study used data from the Program for the International Assessment of Adult Competencies to compare problem-solving skills in technology-rich environments among adults in South Korea, Germany, Singapore, Japan, Canada, Estonia, the United Kingdom, the United States, and Australia. Overall, the United States had the lowest scores among all countries, and in all countries scores declined with age. The United States had higher proportions of survey participants in the lowest skill category and lower proportions in the top-skill categories. The results of this study suggest changes in the U.S. educational and lifelong learning systems, and policies may be necessary to ensure all adults have the necessary skills in a competitive workforce.

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Reducing Income Inequality While Boosting Economic Growth: Can It Be Done? Evidence From Oecd Countries

Cited by 23 publications

References 10 publications

Productivity Growth: Patterns and Determinants across the World

Productivity Growth: Patterns and Determinants across the World

Productivity Growth: Patterns and Determinants “Across” the World

Problem-Solving Skills of the U.S. Workforce and Preparedness for Job Automation

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