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On the Determinants of Distribution Dynamics

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  • Davide Fiaschi
  • Andrea Mario Lavezzi
  • Angela Parenti

Abstract

In this paper we propose a novel approach to identify the impact of growth determinants on the distribution dynamics of productivity. Our approach integrates counterfactual analysis with the estimation of stochastic kernels. The counterfactuals are constructed from a semiparametric growth regression, in which the cross-section heterogeneity in the growth determinants is removed. The methodology also allows us to test for potential distributional effects in the residuals. We illustrate the usefulness of the proposed methodology by an application to a cross-section of countries, which highlights the significant impact on inequality and polarization in the world productivity distribution of growth determinants from an augmented Solow model.

Suggested Citation

  • Davide Fiaschi & Andrea Mario Lavezzi & Angela Parenti, 2013. "On the Determinants of Distribution Dynamics," Discussion Papers 2013/165, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.
    • Handle: RePEc:pie:dsedps:2013/165
    Note: ISSN 2039-1854
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    File URL: https://www.ec.unipi.it/documents/Ricerca/papers/2013-165.pdf
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    References listed on IDEAS

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    Cited by:

    1. Michele Battisti & Massimo Del Gatto & Christopher F. Parmeter, 2018. "Labor productivity growth: disentangling technology and capital accumulation," Journal of Economic Growth, Springer, vol. 23(1), pages 111-143, March.
    2. Basile, Roberto & Durbán, María & Mínguez, Román & María Montero, Jose & Mur, Jesús, 2014. "Modeling regional economic dynamics: Spatial dependence, spatial heterogeneity and nonlinearities," Journal of Economic Dynamics and Control, Elsevier, vol. 48(C), pages 229-245.
    3. Jesús Peiró-Palomino, 2016. "European regional convergence revisited: the role of intangible assets," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 57(1), pages 165-194, July.
    4. Michele Battisti & Massimo Del Gatto & Christopher F. Parmeter, 2018. "Labor productivity growth: disentangling technology and capital accumulation," Journal of Economic Growth, Springer, vol. 23(1), pages 111-143, March.

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    More about this item

    Keywords

    Convergence; inequality; polarization; distribution dynamics; counterfactual analysis.;
    All these keywords.

    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • O50 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - General

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