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Determinants of the long-run growth rate in the South-Asian countries

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  • Rao, B. Bhaskara
  • Cooray, Arusha

Abstract

This study uses the extreme bounds analysis of Leamer (1983) to identify some robust determinants of the long-run growth rate in seven South-Asian countries. The relationships between the two are estimated using panel data. We also consider some methodological issues concerning the specification. It is argued that the frequently used specification of the growth equation by the cross-country studies is inappropriate for estimating the long-run or steady state growth effects of variables such as the investment ratio. We use an alternative specification. Since the steady state growth rate in theoretical growth models depends on total factor productivity (TFP), we estimate the long-run growth effects of variables by analysing the determinants of TFP. This approach is suggested by a few influential economists and has been used by Senhadji (2000).

Suggested Citation

  • Rao, B. Bhaskara & Cooray, Arusha, 2010. "Determinants of the long-run growth rate in the South-Asian countries," MPRA Paper 26493, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:26493
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    References listed on IDEAS

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    Cited by:

    1. Mansour Zarra-Nejad & Fatimah Hosseinpour & Seyed Aziz Arman, 2014. "Trade-Growth Nexus in Developing and Developed Countries: An Application of Extreme Bounds Analysis," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 4(7), pages 915-929, July.
    2. Fatimah Hosseinpour, Mansour Zarra-Nezhad, Sayed Aziz Arman and Ahmad Salahmanesh, 2019. "Determinants of Economic Growth in the Developing Countries: An Extreme Bounds Analysis," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 44(4), pages 43-67, December.

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    More about this item

    Keywords

    South-Asian countries; Extreme bounds analysis; Long-run growth rate; Total factor productivity.;
    All these keywords.

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development

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