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The Empirical Growth Literature

The Empirical Growth Literature

Copyright: © 2014 |Pages: 38
ISBN13: 9781466658486|ISBN10: 1466658487|EISBN13: 9781466658493
DOI: 10.4018/978-1-4666-5848-6.ch005
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MLA

Rup Singh. "The Empirical Growth Literature." Bridging the Gap Between Growth Theory and Policy in Asia: An Extension of the Solow Growth Model, IGI Global, 2014, pp.104-141. https://doi.org/10.4018/978-1-4666-5848-6.ch005

APA

R. Singh (2014). The Empirical Growth Literature. IGI Global. https://doi.org/10.4018/978-1-4666-5848-6.ch005

Chicago

Rup Singh. "The Empirical Growth Literature." In Bridging the Gap Between Growth Theory and Policy in Asia: An Extension of the Solow Growth Model. Hershey, PA: IGI Global, 2014. https://doi.org/10.4018/978-1-4666-5848-6.ch005

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Abstract

This chapter surveys the empirical growth literature on the selected Asian economies investigating the effects of a few important determinants of growth (e.g. the investment rate, trade openness, human capital, financial development, and macroeconomic policy environment). The summary provides some important insights but also presents conflicting findings, which unanimously do not always conform to the conclusions of the theoretical models. For instance, whilst investment is agreed to be an important determinant of growth, the literature puts emphasis on the type of investment in question and the important interactions between investment and other variables like trade openness and good policy environment. On trade openness, the absence of a strong theoretical basis, data limitations, and therefore, the use of right or wrong proxies shadow the impact of trade and growth. However, international data on trade patterns and other empirical evidences do support strongly that openness to trade has positive growth effects. There is no doubt of a strong theoretical support for the impact of human capital on growth. The reflective empirical findings also support this view, except that there are measurement problems for indicators like education attainment and quality of education. Similarly, the consensus is that credible policies and sound institutions are growth supportive. Cross-country findings have provided some uniform results, but country-specific findings show large variability on almost all the tested variables. Against this background, this chapter develops a pragmatic survey on five important hypothesized forces of economic growth.

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