Options
Solow (1956) as a model of cross-country growth dynamics
Author(s)
Date Issued
2007-02
Date Available
2008-06-12T13:57:30Z
Abstract
Despite the widespread popularity of the Solow growth model, much of the recent empirical work based on the classic framework misrepresents a crucial feature of the model. Namely, the growth rate of technological progress, assumed to be exogenous in the Solow model, is often identified as being constant across countries. This simplification of the behaviour of technological progress runs counter to the evidence and has had a number of significant implications for the interpretation of the Solow model. One implication has been an overemphasis on the role of factor accumulation in explaining cross-country income differentials. In addition, the commonly-cited empirical result that the speed of conditional convergence is slower than predicted by the Solow model is a function of this inaccurate assumption about technology rather than due to a failure of the model itself.
Type of Material
Technical Report
Publisher
Central Bank of Ireland
Series
Research Technical Paper
1/RT/07
Copyright (Published Version)
2007 Copyright Central Bank of Ireland
Subject – LCSH
Solow growth model
Convergence (Economics)
Industrial productivity
Language
English
Status of Item
Not peer reviewed
This item is made available under a Creative Commons License
File(s)
Owning collection
Views
1787
Last Week
1
1
Acquisition Date
Apr 17, 2024
Apr 17, 2024
Downloads
701
Last Week
2
2
Acquisition Date
Apr 17, 2024
Apr 17, 2024