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Total Factor Productivity, Per Capita Income and Social Divergence

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  • R. QUENTIN GRAFTON
  • STEPHEN KNOWLES
  • P. DORIAN OWEN

Abstract

The paper introduces the concept of social divergence, defined as the social barriers to communication and exchange between individuals and groups within a society, and analyses its impact on total factor productivity and per capita income. Using a cross section of 27 developing countries, total factor productivity and per capita income are separately regressed on measures of social divergence that include the distribution of personal expenditures, ethnolinguistic diversity, religious diversity and an educational Gini coefficient. The results indicate that higher levels of social divergence are associated with both statistically and economically significantly lower levels of total factor productivity and per capita income. Copyright © 2004 Economic Society of Australia..

Suggested Citation

  • R. Quentin Grafton & Stephen Knowles & P. Dorian Owen, 2004. "Total Factor Productivity, Per Capita Income and Social Divergence," The Economic Record, The Economic Society of Australia, vol. 80(250), pages 302-313, September.
  • Handle: RePEc:bla:ecorec:v:80:y:2004:i:250:p:302-313
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    References listed on IDEAS

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    1. Robert E. Hall & Charles I. Jones, 1999. "Why do Some Countries Produce So Much More Output Per Worker than Others?," The Quarterly Journal of Economics, Oxford University Press, vol. 114(1), pages 83-116.
    2. Stephen Knack & Philip Keefer, 1997. "Does Social Capital Have an Economic Payoff? A Cross-Country Investigation," The Quarterly Journal of Economics, Oxford University Press, vol. 112(4), pages 1251-1288.
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    6. repec:dau:papers:123456789/10091 is not listed on IDEAS
    7. Persson, Torsten & Tabellini, Guido, 1994. "Is Inequality Harmful for Growth?," American Economic Review, American Economic Association, vol. 84(3), pages 600-621, June.
    8. Cecilia Garcia-Penalosa & Eve Caroli & Philippe Aghion, 1999. "Inequality and Economic Growth: The Perspective of the New Growth Theories," Journal of Economic Literature, American Economic Association, vol. 37(4), pages 1615-1660, December.
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    1. repec:bla:asiaps:v:4:y:2017:i:1:p:20-37 is not listed on IDEAS
    2. Boon Lee, 2011. "Distribution Trade Sector Output and Productivity Performance: A Case Study of Singapore and Hong Kong 2001-2008," School of Economics and Finance Discussion Papers and Working Papers Series 270, School of Economics and Finance, Queensland University of Technology.
    3. Ratna, Nazmun N. & Quentin Grafton, R. & Kompas, Tom, 2009. "Is diversity bad for economic growth?: Evidence from state-level data in the US," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 38(6), pages 859-870, December.
    4. Knowles, Stephen, 2006. "Is Social Capital Part of the Institutions Continuum and is it a Deep Determinant of Development?," WIDER Working Paper Series 025, World Institute for Development Economic Research (UNU-WIDER).
    5. Nazmun N. Ratna & Quentin Grafton & Ian A. MacDonald, 2012. "Does Multiculturalism Pay? Empirical Evidence from the United States and Canada," Economic Papers, The Economic Society of Australia, vol. 31(4), pages 401-417, December.
    6. R. Grafton & Tom Kompas & P. Owen, 2007. "Bridging the barriers: knowledge connections, productivity and capital accumulation," Journal of Productivity Analysis, Springer, vol. 28(3), pages 219-231, December.
    7. Neri, Frank & Ville, Simon, 2008. "Social capital renewal and the academic performance of international students in Australia," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 37(4), pages 1515-1538, August.

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