Journal Article
No. 2012-16 | May 10, 2012
Cross-Country Growth Empirics and Model Uncertainty: An Overview
(Published as 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.

JEL Classification:

C21, C23, C52, O40, O47

Assessment

  • Downloads: 2621 (Discussion Paper: 1733)

Links

Cite As

Bülent Ulaşan (2012). Cross-Country Growth Empirics and Model Uncertainty: An Overview. Economics: The Open-Access, Open-Assessment E-Journal, 6 (2012-16): 1–69. http://dx.doi.org/10.5018/economics-ejournal.ja.2012-16


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