Applications tend to ignore that measured TFP reflects the variation of output that cannot be explained by changes in inputs. Such a change is not necessarily technological, so measured TFP differences across firms are an amalgam of technological, efficiency and other differences in attributes,...

In this paper, we assess the effect of globalization on the distribution of income within countries, focussing on the influence of foreign direct investment. We analyze data for 72 countries, 1970-90. We incorporate in our tests the Kuznets (1955) curve, measures of the character of political...

The defense-growth nexus is investigated empirically using longitudinal data for Guatemala and allowing the effect of defense spending on growth to be nonlinear. Using recently developed econometric methods involving threshold regressions, evidence of a level-dependent effect of military...

This paper proposes a new model-based method to obtain a coincident indicator for the business cycle. A dynamic factor model with trend components and a common cycle component is considered which can be estimated using standard maximum likelihood methods. The multivariate unobserved components...

There has been a revival of interest in the effect of risk on economic growth. We quantify both ex ante and ex post effects of risk using a stochastic version of the Ramsey model. We develop a simulation-based econometric methodology which allows us to estimate the model in the structural form...

Economists increasingly pay attention to social capital as an important determinant of macroeconomic growth performance. At the same time, there is discussion regarding the robustness of the results of empirical growth studies. In a seminal paper, Knack and Keefer (1997) assess the effect of...

This paper explores the link between trade structure, trade specialization and per capita incomegrowth. It is argued that industrial upgrading in export specialization patterns has a positive long-rungrowth effect, while the effect of structural change in industrial import patterns is in...

Foreign aid’s effectiveness in promoting economic growth remains mired in controversy.We examine the impact of the volatility of aid on economic growth, controlling for the level of aid. A four-year panel analysis is conducted encompassing 155 countries over the period 1966-2001. We find that...

An exact maximum likelihood method is developed for the estimation of parameters in a nonlinear non-Gaussian dynamic panel data model with unobserved random individual-specific and time-varying effects. We propose an estimation procedure based on the importance sampling technique. In particular,...

We study economic growth in four emerging economies - Brazil, Russia, India, and China (BRIC). Questions addressed are: (a) How do medium term growth determinants differ from short term determinants? (b) What are differences between growth effects of aggregate versus disaggregated exports? And...