Economic Growth and Verdoorn's Law in the Spanish Regions, 1962-1991
The aim of this paper is to test for the presence of dynamic increasing returns to scale in Spanish regional growth between 1962 and 1991. The theoretical framework within which this paper is based is the so-called Verdoorn's Law. Tests of the law are performed not only for the manufacturing sector but also for agriculture, construction, services and total value added. The results show substantial increasing returns for manufacturing for the services sector and for total value added. The static-dynamic paradox found by McCombie (1982) is also discussed and tested. We find no support for the hypothesis of a Cobb-Douglas as the underlying technical relationship of the law.
|Date of creation:||Jan 1998|
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|Publication status:||Forthcoming in International Review of Applied Economics, 2000|
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- Kaldor, Nicholas, 1975. "Economic Growth and the Verdoorn Law-A Comment on Mr. Rowthorn's Article," Economic Journal, Royal Economic Society, vol. 85(340), pages 891-96, December.
- McCombie, J S L, 1991. "The Productivity Growth Slowdown of the Advanced Countries and the Inter-sectoral Reallocation of Labour," Australian Economic Papers, Wiley Blackwell, vol. 30(56), pages 70-85, June.
- A. P. Thirlwall, 1983. "A Plain Man's Guide to Kaldor's Growth Laws," Journal of Post Keynesian Economics, M.E. Sharpe, Inc., vol. 5(3), pages 345-358, April.
- McCombie, J S L & de Ridder, J R, 1984. ""The Verdoorn Law Controversy": Some New Empirical Evidence Using U.S. State Data," Oxford Economic Papers, Oxford University Press, vol. 36(2), pages 268-84, June.
- Zvi Griliches & Jerry A. Hausman, 1984.
"Errors in Variables in Panel Data,"
NBER Technical Working Papers
0037, National Bureau of Economic Research, Inc.
- Kaldor, Nicholas, 1970. "The Case for Regional Policies," Scottish Journal of Political Economy, Scottish Economic Society, vol. 17(3), pages 337-48, November.
- Fingleton, B & McCombie, J S L, 1998. "Increasing Returns and Economic Growth: Some Evidence for Manufacturing from the European Union Regions," Oxford Economic Papers, Oxford University Press, vol. 50(1), pages 89-105, January.
- Chatterji, Monojit & Wickens, Michael R, 1982. "Productivity, Factor Transfers and Economic Growth in the UK," Economica, London School of Economics and Political Science, vol. 49(193), pages 21-38, February.
- John S. L. McCombie & John R. De Ridder, 1983. "Increasing Returns, Productivity, and Output Growth: The Case of the United States," Journal of Post Keynesian Economics, M.E. Sharpe, Inc., vol. 5(3), pages 373-387, April.
- Dixon, R & Thirlwall, A P, 1975. "A Model of Regional Growth-Rate Differences on Kaldorian Lines," Oxford Economic Papers, Oxford University Press, vol. 27(2), pages 201-14, July.
- A. P. Thirlwall, 2007. "Regional Problems are "Balance-of-Payments" Problems," Regional Studies, Taylor & Francis Journals, vol. 41(sup1), pages S89-S95.
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