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The Relationship between Population Growth and Standard-of-Living Growth Over 1870-2013: Evidence from a Bootstrapped Panel Granger Causality Test

Listed author(s):
  • Tsangyao Chang

    (Feng Chia University)

  • Hsiao-Ping Chu

    (Feng Chia University)

  • Frederick W. Deale

    (University of Pretoria)

  • Rangan Gupta

    (University of Pretoria)

  • Stephen M. Miller

    (University of Nevada, Las Vegas and University of Connecticut)

This paper examines the linkages between population growth and standard-of-living growth in 21 countries over the period of 1870-2013. We apply the bootstrap panel causality test proposed by Kónya (2006), which accounts for both dependency and heterogeneity across countries. We find one-way Granger causality running from population growth to standard-of-living growth for Finland, France, Portugal, and Sweden, one-way Granger causality running from standard-of-living growth to population growth for Canada, Germany, Japan, Norway and Switzerland, two-way causality for Austria and Italy, and no causal relationship for Belgium, Brazil, Denmark, Netherlands, New Zealand, Spain, Sri Lanka, the UK, the USA, and Uruguay. Dividing the sample into two subsamples due to a structural break yields different results over the two periods of 1871-1951 and 1952-2013. Our empirical results suggest important policy implications for these 21 countries as the directions of causality differ across countries and time period.

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File URL: http://web2.uconn.edu/economics/working/2016-17.pdf
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Paper provided by University of Connecticut, Department of Economics in its series Working papers with number 2016-17.

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Length: 39 pages
Date of creation: Sep 2016
Handle: RePEc:uct:uconnp:2016-17
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Web page: http://www.econ.uconn.edu/

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