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Decomposing The Conditional Variance of Cross-Country Output

Author

Listed:
  • Shahram Amini

    (Department of Economics, Virginia Polytechnic Institute and State University)

  • Michele Battisti

    (Department of Studies on Law, Politics and Society, University of Palermo)

  • Christopher F. Parmeter

    (Department of Economics, University of Miami)

Abstract

A well established fact in the growth empirics literature is the increasing variation in output per capita across countries. This phenomena however does not adequately describe changes in the distribution of output since it does not account for changes in the covariates which undoubtedly in influence per capita output levels. We propose a robust, nonparametric decomposition of the conditional variation of per capita output and find that OECD countries have experienced diminishing conditional variation while other regions have experienced increasing conditional variation. Our decomposition suggests that most of these changes in the conditional variance of output is due to unobserved factors not accounted for by the traditional growth determinants. In addition to this we show as these factors played very different roles over time and across regions.

Suggested Citation

  • Shahram Amini & Michele Battisti & Christopher F. Parmeter, 2011. "Decomposing The Conditional Variance of Cross-Country Output," Working Papers 2011-18, University of Miami, Department of Economics.
  • Handle: RePEc:mia:wpaper:2011-18
    as

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    File URL: http://bus.miami.edu/_assets/files/faculty-and-research/academic-departments/eco/eco-working-papers/2011/WP2011-18.pdf
    File Function: First version, 2011
    Download Restriction: no

    References listed on IDEAS

    as
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    More about this item

    Keywords

    Generalized Kernel; Nonparametric; Conditional Variation;

    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • G0 - Financial Economics - - General
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • O50 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - General

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