Type of Document Dissertation Author Masanjala, Winford Henderson Author's Email Address email@example.com URN etd-0624103-122017 Title Empirical Analysis of Economic Growth Degree Doctor of Philosophy (Ph.D.) Department Economics Advisory Committee
Advisor Name Title Chris Papageorgiou Committee Chair Dek Terrell Committee Member Douglas McMillin Committee Member Marios Zachariadis Committee Member Cameron Thies Dean's Representative Keywords
- constant elasticity of substitution
- Solow growth model
- parameter heterogeneity
- multiple regimes
- Bayesian model averaging
- endogenous threshold methodology
- economic growth
Date of Defense 2003-05-09 Availability unrestricted AbstractInternational evidence on growth rates in per capita incomes reveals persistent differences in development patterns among nations, and shows that the world distribution of per capita income is multi-modal with several basins of attraction. This dissertation investigates the factors underlying these international variations in both the level and rate of growth of per capita incomes.
The first essay examines whether nonlinearities in the aggregate production function can explain parameter heterogeneity in the Solow (1956) growth regressions. The choice of and alternative specification of the production function is justified by showing that cross-country level regressions are more consistent with the more general Constant Elasticity of Substitution (CES) than the Cobb-Douglas technology which currently underlies the Solow model. Then, by using an endogenous threshold methodology, we find that the Solow model, using the nonlinear CES technology, implies more robust parameter heterogeneity that is consistent with the existence of multiple regimes.
The second essay uses Bayesian Model Averaging methodology to ascertain whether the determinants of economic growth are the same in Africa as elsewhere. Specifically, we estimate the posterior probability of a number of possible explanatory variables and potential cross-country regression models. We find that in both the short and long run, determinants of growth in Africa are different from the rest of the world. In addition, our findings suggest that in contrast to the rest of the world, initial conditions are more important in explaining African growth than policy and institutional variables.
The third essay investigates the role of initial conditions as threshold variables in economic development. Using the endogenous threshold methodology we test whether initial stocks of human capital, initial level of economic development and natural conditions do affect long run growth in per capita incomes. We get two interesting results. First, initial stocks of human capital and the initial level of economic development have lasting effects on long run growth in per capita incomes. Second, initial conditions reflecting natural conditions have no lasting effect on economic growth.
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