Working Paper: CEPR ID: DP1275
Authors: Angel de la Fuente
Abstract: Recent empirical studies tend to confirm the importance of investment in human and technological capital as determinants of growth. Extensions of the neoclassical model that incorporate these factors explain rather well the long-run growth experience of a large sample of countries, and are consistent with the observed level of international inequality and its upward trend. These models do not explain very well the variation of growth rates over time, however, and the lack of robustness of the estimated coefficients to sample selection, specification, and other factors suggests that we are still far from having precise estimates of structural parameters such as the coefficients of the aggregate production function. Finally, the methodology employed in these studies does not allow us to reach clear conclusions regarding the likely evolution of the international income distribution of income, or the policies which may have an impact on growth.
Keywords: growth; convergence
JEL Codes: B23; O30; O47
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Investment in human and technological capital (J24) | Economic growth (O49) |
| Initial income levels and investment rates (F21) | Economic growth (O00) |
| Investment rates (G31) | Economic growth (O49) |
| Conditional convergence (O47) | Economic growth (O49) |
| Economic growth (O00) | Faster growth in poorer countries (F63) |