Previous research shows that technical progress at the industry level, measured by sectoral TFP growth, is more localized in continental European countries than in Anglo-Saxon coun-tries. We use EU KLEMS data sets to decompose sectoral TFP for nine European countries by means of a Malmquist...

Growth is associated with (i) shifts in the sectoral structure of the economy, (ii) changes in relative prices and (iii) the Kaldor facts. Moreover, (iv) cross-sectional data shows systematic differences in the expenditure structure across income groups. This paper presents a growth model which...

It is common practice to estimate the volatility-growth link by specifying a standard growth equation such that the variance of the error term appears as an explanatory variable in this growth equation. The variance in turn is modelled by a second equation. Hardly any of existing applications of...

Recently Acemolgu, Aghion, Bursztyn and Hemous (AER 2012) formulated a model in which a high macroeconomic elasticity of substitution between clean and dirty production represents a crucial condition for green growth. Until now it has never been systematically estimated. Using a novel panel of...

Welfare aspects of longevity increases are often discussed neglecting the complex relationship between longevity and economic growth, which is the focal point of another literature. Combining both perspectives, we develop an endogenous growth OLG-framework to investigate how longevity affects...

This paper examines whether foreign aid contributes to attracting foreign direct investment (FDI) in aid receiving countries. Using both homogeneous and heterogeneous panel cointegration techniques, I find that the effect of foreign aid on FDI is negative. This is in contrast to previous studies...

Higher child mortality reduces the willingness of parents to invest in children's education and increases their desired level of fertility. In this context, economic inequality is not only decisive for human capital investments and the emergence of differential fertility, but also for agents'...

This contribution examines the role of market-capitalism in anti-American terrorism. It differentiates between level- and rate-of-change-effects associated with market-capitalist development and their respective relationship with anti-U.S. violence. While this contribution argues that higher...

Expectations matter for economic activity. To the extent that they are fundamentally unwarranted, they represent "undue optimism or pessimism" (Pigou, 1927). In this paper, we identify empirically the effect of undue optimism/pessism ("optimism shocks") on economic activity. In a first step, we...