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Solow vs. Solow: Notes on Identification and Interpretation in the Empirics of Growth and Development

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  • Erich Gundlach

Abstract

Most empirical studies of long run growth refer to one of the two seminal contributions by Robert Solow (1956, 1957). His work shows that in order to estimate the relative roles of factor accumulation and technology in development, an a priori identification assumption is needed about the nature of technical change. This specific assumption differs across the two Solow papers. I show that starting with the identification assumption made in Solow (1956), one should expect to find that differences in technology rather than differences in factor accumulation explain most if not all of the observed long-run differences in output per worker. The opposite interpretation appears to prevail in parts of the recent literature on the empirics of growth.
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  • Erich Gundlach, 2005. "Solow vs. Solow: Notes on Identification and Interpretation in the Empirics of Growth and Development," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 141(3), pages 541-556, October.
    • Handle: RePEc:spr:weltar:v:141:y:2005:i:3:p:541-556
    DOI: 10.1007/s10290-005-0042-8
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    3. Kwack, Sung Yeung & Lee, Young Sun, 2006. "Analyzing the Korea's growth experience: The application of R&D and human capital based growth models with demography," Journal of Asian Economics, Elsevier, vol. 17(5), pages 818-831, November.
    4. Alessandro Bellocchi & Giuseppe Travaglini & Beatrice Vitali, 2023. "How capital intensity affects technical progress: An empirical analysis for 17 advanced economies," Metroeconomica, Wiley Blackwell, vol. 74(3), pages 606-631, July.
    5. Acikgoz, Senay & Ben Ali, Mohamed Sami, 2019. "Where does economic growth in the Middle Eastern and North African countries come from?," The Quarterly Review of Economics and Finance, Elsevier, vol. 73(C), pages 172-183.
    6. Matthias Busse & Jens Koeniger, 2015. "Trade and economic growth: A re-examination of the empirical evidence," Economics Bulletin, AccessEcon, vol. 35(4), pages 2862-2876.
    7. Erich Gundlach, 2007. "The Solow model in the empirics of growth and trade," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 23(1), pages 25-44, Spring.

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