Distinguishing between potential sources of growth convergence for the Portuguese economy within the EU. A panel data - time series study of the aggregate production function
AbstractWhat are the potential sources of growth and how is the convergence process of the Portuguese economy within the EU characterised? We answer this question by determining the most suitable specification of the aggregate production function, CES or Cobb-Douglas, for the EU countries as in Duffy&Papageorgiou (2000). If the aggregate production technology is best described by a CES production function then the potential sources of growth are wider than the ones associated with a Cobb-Douglas technology. For instance, with an elasticity of substitution between inputs greater than one (ó>1) it is possible to have endogenous growth (see Jones&Manuelli (1990), Rebelo (1991)) while for ó 1, it is possible to have endogenous growth although the characterisation of our series does not allow us to ignore the spurious regression problem.
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Bibliographic InfoPaper provided by University of Évora, Department of Economics (Portugal) in its series Economics Working Papers with number 7_2003.
Length: 23 pages
Date of creation: 2003
Date of revision:
Economic growth; endogenous growth; multiple equilibriums; CES production technology; Cobb-Douglas production technology; human capital; panel data; time series data; cointegration in panel data;
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