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Hindered growth

Author

Listed:
  • Elitzur, Moshe
  • Kaplan, Scott
  • Zilberman, David

Abstract

We develop a formalism to extract the exponential component from a growth process and describe the remainder with the optimal number of parameters. The method is demonstrated analyzing the time variation of Gross Domestic Product (GDP) and population in the US and UK, two nations with continuous data coverage going back more than 200 years. For each of the four datasets we find a successful description, with the deviation of long-term growth from a pure exponential requiring no more than a single free parameter; there is no significant gain from adding more parameters. We find persistent long-term growth patterns, consistent with Jones (1995) and showing directly from the data that population and GDP growth in different countries may follow different trajectories, illuminating their intrinsic differences.

Suggested Citation

  • Elitzur, Moshe & Kaplan, Scott & Zilberman, David, 2020. "Hindered growth," Journal of Economic Dynamics and Control, Elsevier, vol. 111(C).
    • Handle: RePEc:eee:dyncon:v:111:y:2020:i:c:s0165188919302040
    DOI: 10.1016/j.jedc.2019.103807
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    References listed on IDEAS

    as
    1. Gary S. Becker & Kevin M. Murphy & Robert Tamura, 1994. "Human Capital, Fertility, and Economic Growth," NBER Chapters, in: Human Capital: A Theoretical and Empirical Analysis with Special Reference to Education, Third Edition, pages 323-350, National Bureau of Economic Research, Inc.
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    More about this item

    Keywords

    Exponential growth; Logistic growth; Growth hindering; Time series;
    All these keywords.

    JEL classification:

    • C1 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General
    • C5 - Mathematical and Quantitative Methods - - Econometric Modeling
    • C6 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling
    • N1 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations
    • N3 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy

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