Discussion Paper

No. 2011-37 | September 09, 2011
Cross-Country Growth Empirics and Model Uncertainty: An Overview
(Submitted for Survey and Overview)

Abstract

The aim of this paper is to provide an overview of empirical cross-country growth literature. The paper begins with describing the basic framework used in recent empirical cross-country growth research. Even though this literature was mainly inspired by endogenous growth theories, the neoclassical growth model is still the workhorse for cross-country growth empirics. The second part of the paper emphasises model uncertainty, which is indeed immense but generally neglected in the empirical cross-country growth literature. The most outstanding feature of the literature is that a large number of factors have been suggested as fundamental growth determinants. Together with the small sample property, this leads to an important problem: model uncertainty. The questions which factors are more fundamental in explaining growth dynamics and hence growth differences are still the subject of academic research. Recent attempts based on general-to-specific modeling or model averaging are promising but have their own limits. Finally, the paper highlights the implications of model uncertainty for policy evaluation.

Submitted as Survey and Overview 
 

JEL Classification

O40 O47

Cite As

Bülent Ulaşan (2011). Cross-Country Growth Empirics and Model Uncertainty: An Overview. Economics Discussion Papers, No 2011-37, Kiel Institute for the World Economy. http://www.economics-ejournal.org/economics/discussionpapers/2011-37

Assessment



Comments and Questions


Anonymous - Referee Report 1
October 06, 2011 - 09:54

See attached file


Bülent Ulaşan - Reply to Referee Report 1
April 18, 2012 - 15:28

I would like to thank the anonymous referee for those nice comments. I have updated the references indicated by the referee in the revised version of the paper.


Anonymous - comments: survey on cross-country growth empirics and model uncertainty
October 18, 2011 - 12:33

see attached pdf.


Bülent Ulaşan - Reply to the Anonymous Reader’s Report
April 18, 2012 - 15:42

I would like to thank the anonymous reader for reviewing my paper and making such valuable comments. It is obvious that the comments of the anonymous reader have substantively improved the paper. Please see attached file for my detailed responses to the anonymous reader’s report.


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