https://www.oxfordmartin.ox.ac.uk/downloads/academic/The_Future_of_Employment.pdf

The future of employment: How susceptible are jobs to computerisation?

Offering a unifying theoretical perspective not readily available in any other text, this innovative guide to econometrics uses simple geometrical arguments to develop students' intuitive understanding of basic and advanced topics, emphasizing throughout the practical applications of modern theory and nonlinear techniques of estimation. One theme of the text is the use of artificial regressions for estimation, reference, and specification testing of nonlinear models, including diagnostic tests for parameter constancy, serial correlation, heteroscedasticity, and other types of mis-specification. Explaining how estimates can be obtained and tests can be carried out, the authors go beyond a mere algebraic description to one that can be easily translated into the commands of a standard econometric software package. Covering an unprecedented range of problems with a consistent emphasis on those that arise in applied work, this accessible and coherent guide to the most vital topics in econometrics today is indispensable for advanced students of econometrics and students of statistics interested in regression and related topics. It will also suit practising econometricians who want to update their skills. Flexibly designed to accommodate a variety of course levels, it offers both complete coverage of the basic material and separate chapters on areas of specialized interest.

Estimation and Inference in Econometrics

Part 1 Unemployment in the model of balanced growth: the labour market long-run equilibrium and balanced growth adjustment dynamics. Part 2 further ananlysis of the labour market: search intensity and job advertising.

Equilibrium Unemployment Theory

Finance, entrepreneurship and growth

Development of the banking sector exerts a large, causal impact on total factor productivity growth, which in turn causes GDP to grow. Whether banking development has a long-run effect on capital growth or private saving remains to be seen. Beck, Levine, and Loayza evaluate whether the level of development in the banking sector exerts a causal impact on economic growth and its sources- total factor productivity growth, physical capital accumulation, and private saving. They use (1) a pure cross-country instrumental variable estimator to extract the exogenous component of banking development and (2) a new panel technique that controls for country-specific effects and endogeneity. They find that: - Banks do exert a large, causal impact on total factor productivity growth, which feeds through to overall GDP growth. - The long-run links between banking development and both capital growth and private savings are more tenuous. This paper - a product of Finance, Development Research Group - is part of a larger effort in the group to understand the links between the financial system and economic growth.

https://papers.ssrn.com/sol3/Delivery.cfm/SSRN_ID569227_code382649.pdf?abstractid=569227&rulid=5428171&mirid=4

Finance and the Sources of Growth

This paper is concerned with evaluating the non-market-clearing (NMC) approach of Robert Barro and Herschel Grossman and others from a purely positive point of view. That is, it deals with the broad question of the extent to which the approach provides a theoretically satisfactory explanation of certain stylized facts characterizing the dynamic behavior of aggregate output and the price level. It does not deal with the important and difficult normative questions involving stabilization policy that are often associated with the approach. From this viewpoint the main strength of the NMC approach is its compatibility with the evidence that 1) fluctuations in aggregate output are closely (positively) correlated with fluctuations in aggregate demand, 2) output appears to respond with a much shorter lag than does the price level to changes in aggregate demand, and 3) changes in output are serially correlated from quarter to quarter. The main weakness of the approach is its failure to provide any satisfactory account of how markets are organized. For example, it offers no explanation of how prices are formed, beyond the crude hypothesis that they move in the direction of excess demands, despite the fact that the assumption that prices fail to respond quickly enough to clear markets lies at the heart of the approach. Nor does it explain why agents should be constrained to trade at these prices, even though these constraints are what ultimately produce the multiplier process of the approach. This inattention to the details of market organization also appears to be responsible for the curious "supply multiplier," according to which an increase in aggregate demand, from an initial position of generalized excess demand or even of full employment equilibrium, causes a decrease in output-a prediction that threatens to undermine the compatibility of the approach with the positive correlation between aggregate demand and output unless some reason can be found why excess demand should be less common than excess supply. This shortcoming does not imply that the NMC approach is not useful for many purposes, nor that its predictions are inconsistent with the evidence (except for the predictions of the supply multipliers). But to be consistent with the evidence is not to explain it. What the approach lacks is a satisfactory theoretical underpinning that would at least make it consistent with the same notions of rational self-interest that underlie the rest of economic theory. This leaves us with the question of whether a satisfactory underpinning can be provided to the approach. In other words, can the approach be revised or replaced in such a way that the resulting theory contains a more satisfactory account of market organization, and explains the above mentioned stylized facts in a way that closely resembles the NMC approach. This question cannot now be answered with a great deal of confidence because no one has yet developed a satisfactory theory of market organization. However I think that an affirmative answer is likely, and that the key to developing the answer lies in recognizing that different markets are organized in different ways. In particular some markets, such as those for many labor services, personal credit, and heavy capital goods, are organized on a highly personal basis with individually negotiated contracts, whereas other markets, such as those for widely traded financial assets and for most consumer durables, are organized on a less personal basis by trading specialists like retailers, wholesalers, jobbers, brokers, and stock market specialists. The rest of this paper attempts to shed some light on the question of providing a satisfactory theoretical underpinning for the NMC approach by investigating how a market organized by such specialist *University of Western Ontario. I am indebted to David Laidler for helpful conversations on the topic of this paper, to Robert Solow for his critical comments, and to the Humanities and Social Sciences Research Council of Canada for financial support.

https://www.jstor.org/stable/pdfplus/1801617.pdf

Evaluating the Non-Market-Clearing Approach

We use an agent-based computational approach to show how inflation can worsen macroeconomic performance by disrupting the mechanism of exchange in a decentralized market economy. We find that, in our model economy, increasing the trend rate of inflation above 3 percent has a substantial deleterious effect, but lowering it below 3 percent has no significant macroeconomic consequences. Our finding remains qualitatively robust to changes in parameter values and to modifications to our model that partly address the Lucas critique. Finally, we contribute a novel explanation for why cross-country regressions may fail to detect a significant negative effect of trend inflation on output even when such an effect exists in reality.

How Inflation Affects Macroeconomic Performance: An Agent-Based Computational Investigation

In this paper we introduce capital accumulation in the Schumpeterian growth framework. A first main result is that capital accumulation and innovation are both essential inputs to long-run growth. More innovation stimulates capital accumulation by raising the marginal product of capital. More capital accumulation stimulates innovation by raising the profits accruing to a successful innovator. This result runs counter to the conventional belief to the effect that innovation alone determines the long-run growth rate while capital accumulation determines only the level of the long-run growth path. In the second part of the paper we discuss the implication of merging capital accumulation and innovation-led growth for growth accounting.

https://www.jstor.org/stable/10.15609/annaeconstat2009.125-126.0057

Some Thoughts on Capital Accumulation, Innovation, and Growth

To be presented at the ABCDE Conference jointly organized by the World Bank and the Conseil d'Analyse Economique in Paris on 27 June 2000.

Economic Growth and Macroeconomic Dynamics: Knowledge and Development: A Schumpeterian Approach

Can patent protection and product market competition complement each other in enhancing incentives to innovate? In this paper, we address this question by investigating how innovation responses to a substantial policy initiative increasing product market competition interact with the strength of patent rights. We provide empirical evidence of innovation responding positively to the product market reform in industries of countries where patent rights are strong, not where these are weak. The positive response to the reform is more pronounced in industries in which innovators rely more on patenting than in other industries, and in which the scope for deterring entry through patenting is not too large. Our empirical findings are in line with step-by-step innovation models predicting that product market competition enhances innovation and, more importantly, that patent protection can complement competition in inducing innovation.

https://papers.ssrn.com/sol3/Delivery.cfm/nber_w18854.pdf?abstractid=2226842

Peter Howitt

Papers

Evaluating the Non-Market-Clearing Approach

How Inflation Affects Macroeconomic Performance: An Agent-Based Computational Investigation

Some Thoughts on Capital Accumulation, Innovation, and Growth

Economic Growth and Macroeconomic Dynamics: Knowledge and Development: A Schumpeterian Approach

Patent Rights, Product Market Reforms, and Innovation