Can We Grow Faster?
AbstractIt is essential to distinguish between limits on national output and limits on its rate of growth. In the short run if output is below potential, demand stimulus can temporarily increase output and employment, with growth rates that cannot be sustained once the economy reaches full employment, potential output. This barrier is commonly called the NAIRU. The paper discusses the possibility that the economy can reach lower unemployment rates than previously thought, without increasing inflation. As to raising the sustainable rate of growth of potential output, the paper discusses skeptically various proposals: fiscal austerity, tax cuts, downsizing government. Many proposals can at best raise the level of output, not its sustainable growth; many can do neither; some are perverse. Government policies to raise national saving, private and public investment in tangible and human capital, science and technology are the best hopes, but the payoffs are likely to be slow.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Cowles Foundation for Research in Economics, Yale University in its series Cowles Foundation Discussion Papers with number 1149.
Length: 25 pages
Date of creation: Apr 1997
Date of revision:
Contact details of provider:
Postal: Yale University, Box 208281, New Haven, CT 06520-8281 USA
Phone: (203) 432-3702
Fax: (203) 432-6167
Web page: http://cowles.econ.yale.edu/
More information through EDIRC
Postal: Cowles Foundation, Yale University, Box 208281, New Haven, CT 06520-8281 USA
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Mauro Napoletano & Jean-Luc Gaffard, 2010.
"Performances et politiques de croissance : un éclairage empirique à partir d’une étude de l’effet de la taille des pays et nouvelles réflexions théoriques,"
Sciences Po publications
info:hdl:2441/eu4vqp9ompq, Sciences Po.
- Mauro Napoletano & Jean-Luc Gaffard, 2010. "Performances et politiques de croissance. Un éclairage empirique à partir d'une étude de l'effet de la taille des pays et nouvelles réflexions théoriques," Revue de l'OFCE, Presses de Sciences-Po, vol. 0(1), pages 213-248.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Glena Ames).
If references are entirely missing, you can add them using this form.