A number of cross-country comparisons do not find a robust negative relationship between government size and economic growth. In part this may reflect the prediction in economic theory that a negative relationship should exist primarily for rich countries with large public sectors. In this paper...

A number of cross-country comparisons do not find a robust negative relationship between government size and economic growth. In part this may reflect the prediction in economic theory that a negative relationship should exist primarily for rich countries with large public sectors. In this paper...

Does trade openness cause higher GDP per capita? Since the seminal instrumental variables (IV) estimates of Frankel and Romer [F&R](1999) important doubts have surfaced. Is the correlation spurious and driven by omitted geographical and institutional variables? In this paper, we generalize F&R's...

We build and estimate a structural dynamic general equilibrium model of growth and trade. Trade affects growth through changes in consumer and producer prices that in turn stimulate or impede physical capital accumulation. At the same time, growth affects trade, directly through changes in...

This contribution provides evidence for the hypothesis that trade increases growth through its curbing effect on capital taxes. The analysed mechanism includes two different steps and considers the critical points of both the theoretical and empirical studies in this field. In particular, the...

This paper investigates the impact of trade openness on economic growth and development for a sample of 85 middle-income countries over the period 1970-2009. The paper employs non-stationary heterogeneous panel cointegration techniques that take into consideration the impact of cross-section...

In this paper we distinguish different qualities of FDI to re-examine the relationship between FDI and growth. We use quot;qualityquot; to mean the effect of a unit of FDI on economic growth. However, this is difficult to establish because it is a function of many different country and project...

Using panel data for a large number of countries, we find that economic contractions are not followed by offsetting fast recoveries. Trend output lost is not regained, on average. Wars, crises, and other negative shocks lead to absolute divergence and lower long-run growth, whereas we find...

Rodriguez and Rodrik (2000) argue that the relation between openness and growth is still an open question. One of the main problems in the assessment of the effect is the endogeneity of the relation. In order to address this issue, this paper applies the identification through heteroskedasticity...

While various theoretical models predict that openness to international trade accelerates productivity and promotes economic growth, the empirical evidence has been mixed or imprecise. This paper investigates the issue using two panel data sets: one of 56 countries covering the period 1951-1998,...