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Determinants of Long-Term Growth: A Bayesian Averaging of Classical Estimates (BACE) Approach

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  • Xavier Sala-I-Martin
  • Gernot Doppelhofer
  • Ronald I. Miller

Abstract

This paper examines the robustness of explanatory variables in cross-country economic growth regressions. It introduces and employs a novel approach, Bayesian Averaging of Classical Estimates (BACE), which constructs estimates by averaging OLS coefficients across models. The weights given to individual regressions have a Bayesian justification similar to the Schwarz model selection criterion. Of 67 explanatory variables we find 18 to be significantly and robustly partially correlated with long-term growth and another three variables to be marginally related. The strongest evidence is for the relative price of investment, primary school enrollment, and the initial level of real GDP per capita.

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Bibliographic Info

Article provided by American Economic Association in its journal American Economic Review.

Volume (Year): 94 (2004)
Issue (Month): 4 (September)
Pages: 813-835

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Handle: RePEc:aea:aecrev:v:94:y:2004:i:4:p:813-835

Note: DOI: 10.1257/0002828042002570
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  1. Steven N. Durlauf & Danny T. Quah, 1998. "The New Empirics of Economic Growth," NBER Working Papers 6422, National Bureau of Economic Research, Inc.
  2. Islam, Nazrul, 1995. "Growth Empirics: A Panel Data Approach," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 110(4), pages 1127-70, November.
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  20. repec:umd:umdeco:rodriguez9901 is not listed on IDEAS
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    by Jesús Fernández-Villaverde in Nada Es Gratis on 2011-02-09 07:00:07
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    by William Easterly in Aid Watch on 2009-12-10 05:01:50
  3. Did Nations that Boosted Education Grow Faster? , by Garett Jones
    by ? in Econlog on 2012-10-29 09:36:20
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