Growth literature and policies for the developing countries
This paper examines a recent view of Pritchett (2006) that there is a wide gap between growth literature and the policy needs of the developing countries. Growth literature has focussed on the long term growth outcomes but policy makers of the developing countries need rapid improvements in the growth rate in the short to medium terms. We take the view that this gap can be reduced if attention is given to the dynamic effects of policies. With data on Singapore, Malaysia and Thailand we argue that an extended version of the Solow (1956) model is well suited for this purpose. We found that the short to medium term growth effects of investment rate are much higher than its long run effects. Dynamic simulations for Singapore showed that these short run growth effects are significantly higher than the steady state growth rate for up to 10 years.
|Date of creation:||05 Oct 2008|
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- Cooley, Thomas F. & Greenwood, Jeremy & Yorukoglu, Mehmet, 1997.
"The replacement problem,"
Journal of Monetary Economics,
Elsevier, vol. 40(3), pages 457-499, December.
- Thomas F. Cooley & Jeremy Greenwood & Mehmet Yorukoglu, 1994. "The replacement problem," Discussion Paper / Institute for Empirical Macroeconomics 95, Federal Reserve Bank of Minneapolis.
- Cooley, T.F. & Greenwood, J. & Yorukoglu, M., 1995. "The Replacement Problem," UWO Department of Economics Working Papers 9508, University of Western Ontario, Department of Economics.
- Thomas F. Cooley & Jeremy Greenwood & Mehmet Yorukoglu, 1994. "The Replacement Problem," Working Papers 9408, Centro de Investigacion Economica, ITAM.
- Cooley, T.F. & Greenwood, J. & Yorukoglu, M., 1997. "The Replacement Problem," RCER Working Papers 444, University of Rochester - Center for Economic Research (RCER).
- Luintel, Kul B. & Khan, Mosahid & Arestis, Philip & Theodoridis, Konstantinos, 2008. "Financial structure and economic growth," Journal of Development Economics, Elsevier, vol. 86(1), pages 181-200, April.
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