Applying Growth Theory across Countries

The potential problem of reverse causality has been obvious to everyone. It has usually been met with the standard econometric dodge: using lagged values of slow-moving variables as instruments. But this cannot be a serious solution to the problem....

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Main Author:	Solow, Robert M.
Format:	Journal Article
Language:	English en_US
Published:	Washington, DC: World Bank 2014
Subjects:	AGGREGATE PRODUCTION FUNCTION BASIC BLACK MARKET BLACK MARKET PREMIUM BUSINESS CYCLES CAPITAL-LABOR CAPITAL-LABOR RATIO COMPONENTS COMPUTER POWER CONSTANT RETURNS CONSTANT RETURNS TO SCALE COUNTRY REGRESSIONS CROSS-COUNTRY PANEL CROSS-COUNTRY REGRESSION CROSS-COUNTRY STUDIES DEMAND-SIDE DEVELOPING COUNTRIES DYNAMIC MODEL ECONOMIC GROWTH ECONOMIC INCENTIVES ECONOMIC POLICY ECONOMIC RESEARCH ECONOMIC REVIEW ECONOMICS EMPIRICAL RESEARCH EMPIRICAL WORK ENDOGENOUS GROWTH GROWTH PATH GROWTH RATE GROWTH REGRESSION GROWTH REGRESSIONS GROWTH THEORY INDUSTRIAL ECONOMY INEQUALITY INSTRUMENTAL RATIONALITY LAGGED VALUES MARKET ECONOMY NATIONAL ECONOMY NATIONAL INCOME NEW TECHNOLOGY OBSERVED GROWTH OUTPUT GROWTH PLANNED ECONOMY POLICY RESEARCH POOR COUNTRIES POTENTIAL OUTPUT PRIMARY PRODUCERS PRODUCTION FUNCTION PRODUCTION FUNCTIONS RESOURCE ALLOCATION STICKY PRICES TECHNICAL PROGRESS TECHNOLOGICAL CHANGE TECHNOLOGICAL KNOWLEDGE TFP TOTAL FACTOR PRODUCTIVITY
Online Access:	http://documents.worldbank.org/curated/en/2001/05/17737093/applying-growth-theory-across-countries-learned-decade-empirical-research-growth http://hdl.handle.net/10986/17444

id	okr-10986-17444
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spelling	okr-10986-174442021-04-23T14:03:29Z Applying Growth Theory across Countries Solow, Robert M. AGGREGATE PRODUCTION FUNCTION BASIC BLACK MARKET BLACK MARKET PREMIUM BUSINESS CYCLES CAPITAL-LABOR CAPITAL-LABOR RATIO COMPONENTS COMPUTER POWER CONSTANT RETURNS CONSTANT RETURNS TO SCALE COUNTRY REGRESSIONS CROSS-COUNTRY PANEL CROSS-COUNTRY REGRESSION CROSS-COUNTRY STUDIES DEMAND-SIDE DEVELOPING COUNTRIES DYNAMIC MODEL ECONOMIC GROWTH ECONOMIC INCENTIVES ECONOMIC POLICY ECONOMIC RESEARCH ECONOMIC REVIEW ECONOMICS EMPIRICAL RESEARCH EMPIRICAL WORK ENDOGENOUS GROWTH GROWTH PATH GROWTH RATE GROWTH REGRESSION GROWTH REGRESSIONS GROWTH THEORY INDUSTRIAL ECONOMY INEQUALITY INSTRUMENTAL RATIONALITY LAGGED VALUES MARKET ECONOMY NATIONAL ECONOMY NATIONAL INCOME NEW TECHNOLOGY OBSERVED GROWTH OUTPUT GROWTH PLANNED ECONOMY POLICY RESEARCH POOR COUNTRIES POTENTIAL OUTPUT PRIMARY PRODUCERS PRODUCTION FUNCTION PRODUCTION FUNCTIONS RESOURCE ALLOCATION STICKY PRICES TECHNICAL PROGRESS TECHNOLOGICAL CHANGE TECHNOLOGICAL KNOWLEDGE TFP TOTAL FACTOR PRODUCTIVITY The potential problem of reverse causality has been obvious to everyone. It has usually been met with the standard econometric dodge: using lagged values of slow-moving variables as instruments. But this cannot be a serious solution to the problem. The causality issue points to a deeper question: Do cross-country regressions define a meaningful surface along which countries can move back and forth at will? If this is the idea, what mechanism could underlie such a surface? Brock and Durlauf call such a regression a 'model.' Reader suppose in a statistical sense it is. But an economic model should have some internal structure; its causal arrows should rest on some sort of behavioral mechanism, and that seems to be missing in this literature. 2014-03-27T21:21:25Z 2014-03-27T21:21:25Z 2001-05 Journal Article http://documents.worldbank.org/curated/en/2001/05/17737093/applying-growth-theory-across-countries-learned-decade-empirical-research-growth World Bank Economic Review http://hdl.handle.net/10986/17444 English en_US CC BY-NC-ND 3.0 IGO http://creativecommons.org/licenses/by-nc-nd/3.0/igo World Bank Washington, DC: World Bank Publications & Research :: Journal Article
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English en_US
topic	AGGREGATE PRODUCTION FUNCTION BASIC BLACK MARKET BLACK MARKET PREMIUM BUSINESS CYCLES CAPITAL-LABOR CAPITAL-LABOR RATIO COMPONENTS COMPUTER POWER CONSTANT RETURNS CONSTANT RETURNS TO SCALE COUNTRY REGRESSIONS CROSS-COUNTRY PANEL CROSS-COUNTRY REGRESSION CROSS-COUNTRY STUDIES DEMAND-SIDE DEVELOPING COUNTRIES DYNAMIC MODEL ECONOMIC GROWTH ECONOMIC INCENTIVES ECONOMIC POLICY ECONOMIC RESEARCH ECONOMIC REVIEW ECONOMICS EMPIRICAL RESEARCH EMPIRICAL WORK ENDOGENOUS GROWTH GROWTH PATH GROWTH RATE GROWTH REGRESSION GROWTH REGRESSIONS GROWTH THEORY INDUSTRIAL ECONOMY INEQUALITY INSTRUMENTAL RATIONALITY LAGGED VALUES MARKET ECONOMY NATIONAL ECONOMY NATIONAL INCOME NEW TECHNOLOGY OBSERVED GROWTH OUTPUT GROWTH PLANNED ECONOMY POLICY RESEARCH POOR COUNTRIES POTENTIAL OUTPUT PRIMARY PRODUCERS PRODUCTION FUNCTION PRODUCTION FUNCTIONS RESOURCE ALLOCATION STICKY PRICES TECHNICAL PROGRESS TECHNOLOGICAL CHANGE TECHNOLOGICAL KNOWLEDGE TFP TOTAL FACTOR PRODUCTIVITY
spellingShingle	AGGREGATE PRODUCTION FUNCTION BASIC BLACK MARKET BLACK MARKET PREMIUM BUSINESS CYCLES CAPITAL-LABOR CAPITAL-LABOR RATIO COMPONENTS COMPUTER POWER CONSTANT RETURNS CONSTANT RETURNS TO SCALE COUNTRY REGRESSIONS CROSS-COUNTRY PANEL CROSS-COUNTRY REGRESSION CROSS-COUNTRY STUDIES DEMAND-SIDE DEVELOPING COUNTRIES DYNAMIC MODEL ECONOMIC GROWTH ECONOMIC INCENTIVES ECONOMIC POLICY ECONOMIC RESEARCH ECONOMIC REVIEW ECONOMICS EMPIRICAL RESEARCH EMPIRICAL WORK ENDOGENOUS GROWTH GROWTH PATH GROWTH RATE GROWTH REGRESSION GROWTH REGRESSIONS GROWTH THEORY INDUSTRIAL ECONOMY INEQUALITY INSTRUMENTAL RATIONALITY LAGGED VALUES MARKET ECONOMY NATIONAL ECONOMY NATIONAL INCOME NEW TECHNOLOGY OBSERVED GROWTH OUTPUT GROWTH PLANNED ECONOMY POLICY RESEARCH POOR COUNTRIES POTENTIAL OUTPUT PRIMARY PRODUCERS PRODUCTION FUNCTION PRODUCTION FUNCTIONS RESOURCE ALLOCATION STICKY PRICES TECHNICAL PROGRESS TECHNOLOGICAL CHANGE TECHNOLOGICAL KNOWLEDGE TFP TOTAL FACTOR PRODUCTIVITY Solow, Robert M. Applying Growth Theory across Countries
description	The potential problem of reverse causality has been obvious to everyone. It has usually been met with the standard econometric dodge: using lagged values of slow-moving variables as instruments. But this cannot be a serious solution to the problem. The causality issue points to a deeper question: Do cross-country regressions define a meaningful surface along which countries can move back and forth at will? If this is the idea, what mechanism could underlie such a surface? Brock and Durlauf call such a regression a 'model.' Reader suppose in a statistical sense it is. But an economic model should have some internal structure; its causal arrows should rest on some sort of behavioral mechanism, and that seems to be missing in this literature.
format	Journal Article
author	Solow, Robert M.
author_facet	Solow, Robert M.
author_sort	Solow, Robert M.
title	Applying Growth Theory across Countries
title_short	Applying Growth Theory across Countries
title_full	Applying Growth Theory across Countries
title_fullStr	Applying Growth Theory across Countries
title_full_unstemmed	Applying Growth Theory across Countries
title_sort	applying growth theory across countries
publisher	Washington, DC: World Bank
publishDate	2014
url	http://documents.worldbank.org/curated/en/2001/05/17737093/applying-growth-theory-across-countries-learned-decade-empirical-research-growth http://hdl.handle.net/10986/17444
_version_	1764433165097631744

Applying Growth Theory across Countries

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