Showing papers on "Capital deepening published in 2022"
TL;DR: In this paper , the authors evaluated the impact of ICT capital on carbon emission efficiency and its spatial spillover effects from a digital investment perspective, and found that ICT communication capital was found to have the strongest effect on improving carbon emissions efficiency, while ICT hardware capital and software capital had weaker effect.
45 citations
TL;DR: In this paper, the authors investigate the impact of research and development subsidies on R&D inputs and their wider economic effects and find evidence that the effects of R&DI subsidies extend beyond their main effect on corporate research, promoting technological upgrading, capital deepening, and economic growth.
44 citations
TL;DR: In this paper , the authors investigated the role of remittances in the process of human capital development in the top 10 remittance recipients for the period spanning from 1980 to 2019.
Abstract: As a growth input, human capital and remittances have received significant attention and their role on other macro fundamentals has also been investigated. However, the effects of remittances on human capital development are not yet conclusive in the literature. The motivation of the study is to gauge the role of remittances in the process of human capital development in the topb10 remittance recipients for the period spanning from 1980 to 2019. The study has implemented symmetric and asymmetric estimations to explore the effects of remittances, FDI, and gross capital formation on human capital development. The study documented a positive and statistically significant linkage between remittances and human capital development; a similar linkage was revealed for FDI and gross capital formation. Asymmetric assessment detected asymmetric effects running from remittances, FDI, and gross capital formation to human capital development, both in the long-run and the short-run. Moreover, asymmetric shocks in remittances and FDI have exposed positive and statistically significant human capital development. In contrast, gross capital formation revealed a negative and statistically significant connection with human capital development. Referring to a directional causality test, the study documented a feedback hypothesis that holds in explaining the causality between remittances, FDI, and human capital development and unidirectional causality running from gross capital formation and human capital development. In regard to policy formulation, the study suggested that offering additional incentives could induce migrants to send more remittances into the economy, eventually supporting sustainable economic growth. Second, an efficient and effective financial sector can ensure optimal utilization through the channel of capital formation in the economy; therefore, countries must pay attention to the establishment of efficient intermediation.
24 citations
TL;DR: In this paper , the effect of higher capital requirements on bank credit growth in the Czech Republic was explored, drawing on a unique confidential bank-level dataset, and it was shown that higher additional capital requirements have a negative effect on the credit supply of banks maintaining lower capital surplus.
Abstract: The existing literature has displayed mixed results in terms of the relationship between tighter bank capital regulation and lending, which may be due to poor approximation of capital requirements. We emphasise the crucial role of the excess of bank capital over the minimum capital requirement, the capital surplus, in the transmission of more stringent capital regulation. Specifically, we explore the effect of higher capital requirements on bank credit growth in the Czech Republic, drawing on a unique confidential bank-level dataset. Our results indicate that higher additional capital requirements have a negative effect on the credit supply of banks maintaining lower capital surplus. We estimate the effect on annual credit growth to be between 1.2 and 1.8 pp, using a wide range of model specifications and estimation techniques. Furthermore, the relationship between the capital surplus and credit growth proves to be significant also at times of stable capital requirements, i.e., the capital surplus does not serve only as an intermediate channel of higher capital requirements.
10 citations
TL;DR: Wang et al. as discussed by the authors explored the sustainable development of the regional economy from the perspective of human capital, and put forward policy suggestions conducive to sustainable development in China, based on the panel data from 2005 to 2019 in Shandong Province, China.
Abstract: This study aims to explore the sustainable development of the regional economy from the perspective of human capital. Based on the panel data from 2005 to 2019 in Shandong Province, China, this study first analyzes the interactive coupling mechanism between human capital and sustainable economic growth, and then constructs the evaluation model of coupling coordination degree. Results reveal that Shandong Province’s human capital and sustainable economic growth gradually increased; the coupling coordination degree of human capital and sustainable economic growth changed from a state of mild imbalance to slight coordination; sustainable economic growth lagged human capital development; education scale, innovation capacity, growth level, economic openness, and investment and consumption level are the key factors affecting sustainable economic development. Through the above research, the study puts forward policy suggestions conducive to sustainable development in China.
7 citations
TL;DR: In this article , the authors explored the linkages among globalization, human capital development, and productivity growth in Africa from 1990 to 2019 and found that globalization has a significant positive effect on productivity in the long run, while human capital has insignificant positive effects on productivity growth.
Abstract: African countries have demonstrated the weakest economic performance relative to other regions of the world as a result of underutilized capital structure despite being more integrated into the world economy since early 1990, thus, this study explores the linkages among globalization, human capital development, and productivity growth in Africa from 1990 to 2019. We employ Dumitrescu–Hurlin non-causality test, Cross-sectionally Augmented Autoregressive Distributed Lag (CS-ARDL), and Dynamic Panel Threshold model to find a bidirectional causality between human capital development and productivity growth. The result of CS-ARDL shows that globalization has a significant positive effect on productivity growth in the long run, while human capital has insignificant positive effects on productivity growth in both the short and long run. Also, we find that the threshold of human capital is 45.07%, and at any level beneath this threshold value, human capital and globalization impede productivity growth in Africa. The study concludes that the relationship between globalization, human capital development, and productivity growth is nonlinear and conditional on a certain level of human capital before the full benefit of globalization can be reaped in terms of productivity growth in Africa. Therefore, we recommend that the interdisciplinary policymakers should promote human capital development policies that conform to the rising population growth in Africa and take serious caution while making policies regarding globalization.
5 citations
TL;DR: In this paper , the authors investigated the relationship between human capital, trade liberalization, and economic growth by incorporating labor and capital for Pakistan's economy by applying the nonlinear autoregressive distributed lag model.
Abstract: Human capital and trade liberalization are playing a central role in growth theories. However, the link between human capital, trade liberalization, and economic growth remains a challenging question due to the inconclusive results of the previous studies. Paper contributes to this debate through asymmetric links among human capital, trade liberalization, and economic growth by incorporating labor and capital for Pakistan's economy by applying the nonlinear autoregressive distributed lag model. Results suggest that the positive and negative asymmetric impact of trade liberalization and human capital on growth substantially vary in the short and long run. In the long run, the increased trade liberalization hurts economic growth, while increased human capital has a minimal positive impact on economic growth in the short and long run. The implications of this paper are for economists and policymakers to strengthen the role of human capital and trade liberalization for Pakistan.
4 citations
TL;DR: In this article , the authors examined the long-run effects of human capital accumulation on the economic growth of a developing economy using evidence from Ethiopia, and employed the human capital theory of economic growth and the augmented Solow-Swan model as a theoretical framework, and the ARDL bounds cointegration and error correction mechanism for parameter estimation.
Abstract: Economic theory, empirical studies and public policy have underlined the importance of the relationship between human capital accumulation and economic growth. Several developing countries have included human capital development as an integral part of their national development plans and have devoted huge financial resources as a cornerstone to promote economic growth. The purpose of this study is to examine the long-run effects of human capital accumulation on the economic growth of a developing economy using evidence from Ethiopia. The study employed the human capital theory of economic growth and the augmented Solow-Swan model as a theoretical framework, and the ARDL bounds co-integration and error correction mechanism for parameter estimation. Time-series data, covering the period 1980/81 to 2019/20, were employed to examine the long-run relationship between economic growth and its dynamic regressors of human capital indicators. The secondary and tertiary educational attainments of the labour force and life expectancy at birth have a significant positive effect on economic growth of Ethiopia, whereas primary education attainment and adult mortality rate have an insignificant negative effect. On the other hand, physical capital accumulation has positively contributed the country’s economic growth, but trade openness and external debt adversely affect it. Thus, it is suggested that the policymakers should strengthen the country’s institutional capacity while increasing the number of healthy members of the labour force that should also be equipped with quality-based educational attainments.
4 citations
TL;DR: In this paper , the authors estimate the magnitude of capital flight and analyze its impact on economic growth in the West African Economic and Monetary Union (WEMU) countries over the period from 1970 to 2019.
Abstract: This paper estimates the magnitude of capital flight and analyzes its impact on economic growth in the West African Economic and Monetary Union countries. Over the period from 1970 to 2019, total real capital flight from these countries is positive and significant with a magnitude that amounts to $31,075.26 million in constant dollars, or 17.40 percent of investment. Six countries have experienced significant real capital flight over the past four decades: Ivory Coast, Guinea Bissau, Mali, Niger, Burkina Faso, and Senegal. Using dynamic fixed-effects estimation, the paper finds that, in the long run, capital flight significantly reduces economic growth in countries where capital flight is positive and that the negative effect does not appear to be cumulative with investment in the case of these groups of countries. In addition, the paper recommends that the authorities commit to reducing capital flight by improving governance and strengthening the quality of institutions.
3 citations
TL;DR: Li et al. as discussed by the authors investigated the effect of human capital on energy consumption using an extended version of the Stochastic Impacts by Regression on Population, Affluence, and Technology framework.
Abstract: Human capital is an important aspect of energy consumption, exerting crucial effects on economic growth, technological progress, and economic restructuring. This paper presents an in-depth investigation of the effect of human capital on energy consumption using an extended version of the Stochastic Impacts by Regression on Population, Affluence, and Technology framework. The estimated results using a panel dataset covering China’s 30 provincial regions during the period 1997–2018 and applying fixed effects with instrumental variables and the generalized method of moments indicated that an increase in human capital significantly drove energy consumption. A 1% increase in human capital increased energy consumption by approximately 0.3%. A two-step channel analysis to test scale, technical, and structural effects revealed that the positive effect of human capital on energy consumption is based primarily on the scale effect. However, highly educated human capital alleviates the energy pressure of this effect. In contrast to the scale effect, both the technical and structural effects of human capital reduced energy consumption, and this reduction is primarily correlated with enterprises’ utility-oriented technological progress. Finally, we present strategic energy control policy implications related to human capital.
3 citations
TL;DR: In this article , the authors apply their model to the US states from 1980 to 2000 and find evidence that increases in human capital lead to increases in output per worker only in states with average EFNA scores above 5.91.
Abstract: Hall et al. (2010) develop a growth model where the allocation and productivity of human and physical capital depend on the quality of institutions in a country. We apply their model to the US states from 1980 to 2000. Using the Economic Freedom of North America as our measure of institutional quality, we find evidence that increases in human capital lead to increases in output per worker only in states with average EFNA scores above 5.91. Physical capital, unlike in the cross-country case, always has a positive effect on output per worker.
TL;DR: In this article , a new human capital paradigm that measures Pakistan's economic development and human capital formation is presented, where human capital is used as the dependent variable with govt. expenditures on secondary education, expenditures on tertiary education, current health expenditure and gross fixed capital formation as the independent variables.
Abstract: This paper contains a new human capital paradigm that measures Pakistan's economic development and human capital formation. The aim of this paper is to empirically estimate the impact of economic growth on human capital formation in Pakistan. Human capital is used as the dependent variable with govt. expenditures on secondary education, expenditures on tertiary education, current health expenditure and GROSS fixed capital formation as the independent variables. Data is taken from WDI and the P.W.T (10) for the period of 1990-2020. This study is based on time series analysis. In this study ADF unit root and ARDL techniques are used to analyze. gross fixed capital formation, tertiary education and health expenditures are necessary tools for human capital. Tertiary education enhances the productivity of individuals in Pakistan. Findings of this analysis argued that Pakistan has paid much attention to the quality of tertiary education and on current health expenditures and also try to the improvement of the net investment. It will be beneficial for the entire country.
TL;DR: In this article , the authors explore the interaction between human capital and innovation in the process of economic growth using a model of endogenous growth, focusing on how taxes and other policy instruments affect the incentives to invest in human capital.
Abstract: This paper explores the interaction between human capital and innovation in the process of economic growth. Using a model of endogenous growth, we focus on how taxes and other policy instruments affect the incentives to invest in human capital. In contrast to many other growth models we find that the taxation of human capital has a substantial negative effect on its accumulation. This in turn reduces innovation and, consequently, the income growth rate. More surprisingly, other policies that are intended to stimulate growth may have opposing effects on innovation and the accumulation of human capital. For example, while subsidies to research and to intermediate inputs do have positive effects on innovation and growth, they lead to a lower stock of human capital, in the empirically relevant case when the elasticity of intertemporal substitution in consumption is low.
TL;DR: In this paper , the authors focused on economic assessment of human capital and analyzed the definitions of the human capital category, as well as approaches to identify its composition and structure, and proposed a definition of regional human capital.
Abstract: Sustainable regional development should consider the state and improvement of the quality of regional human capital. To this end, the present study focuses on economic assessment of human capital. Additionally, the research analyses the definitions of the “human capital” category, as well as approaches to identifying its composition and structure. After examining various economic assessment techniques, a definition of regional human capital was proposed. The cost approach was chosen as the most suitable tool for the economic assessment of human capital at the regional level. For economic valuation, the study uses a method developed by Chigoryaev and co-authors, including a number of theoretical and methodological modifications that take into account regional specificities. According to the assessment results, the total human capital in Kamchatka krai exceeded 191 billion roubles, of which more than 104 billion accounted for the fixed human capital. The constant growth of human capital in the period 2011–2018 was noted. Simultaneously, the share of the fixed human capital in the overall structure has been steadily increasing. The values of the chain growth rate of the operating human capital ranged from 1.0 to 1.06, while the values of this rate of the fixed human capital ranged from 1.14 to 2.05. A comparative analysis of the ratio of the total human and physical capital showed the presence of an imbalance: the share of human capital was gradually increasing and reached 37.5 % in 2018. The obtained results can be used to create strategic and programme documents in the field of regional socio-economic development. The modified method of Chigoryaev and co-authors can be applied for the valuation of regional human capital in other studies.
01 Jan 2022
TL;DR: In this paper , the authors explored the impact of human capital and social capabilities or skills on the economic growth of Pakistan by using time series data from the period of 1980-2018 taken from World Bank.
Abstract: Theoretically, human capital has a significant relationship with economic growth. In this regard, the present study was conducted to determine the conditions that have a significant and positive relationship with economic growth. The main objective of the study was to explore the impact of human capital and social capabilities or skills on the economic growth of Pakistan. The study estimates the impact of human capital and social capabilities on economic growth of Pakistan by using time series data from the period of 1980-2018 taken from World Bank. Autoregressive distributed lag framework is used for the valuation of variables relationship and direction of connection of variables. Human capital influenced by education expenditure, social capabilities, gross fixed capital formation (GFCF) and children mortality. This study indicates the role of human capital in growth and development of Pakistan. Results showed that health and education are the two main sectors which need significant attention of government. In addition, more investment on human capital can increase the social capabilities. Final consumption expenditure depends on current economic conditions of a nation. Results showed progressive human capital influence economic growth due to social capabilities. These objectives can be attained through sharing the suitable amount of GDP to these sectors.
TL;DR: In this paper , an all-encompassing notion of human capital, as well as it's required conditions of transformation of human resources into human capital are discussed, and the integration of human resource within a dynamic multi-loop nexus of social capital, learning, and knowledge management is also emphasized.
Abstract: China is the country with the largest population in the world. It has abundant human resources, but it is very scarce in terms of human capital, which is lower than that of the most developed countries. The scarcity of human capital directly affects the enterprise growth. Human capital plays a key role in the operation and development of enterprises. Giving internal employees of businesses full credit for the value of their human capital may act as a powerful engine for their growth. Human capital indicates the market’s demand for labor and the value that labor may provide to the economy, whereas human resources reflect the number and caliber of laborers in a nation. It has to do with how supply and demand on the market are changing. Investment in human resources produces human capital. This paper discussed an all-encompassing notion of human capital, as well as it’s required conditions of transformation of human resources into human capital. It also emphasizes the integration of human capital within a dynamic multi-loop nexus of social capital, learning, and knowledge management. In addition, the characteristics of human capital management in modern enterprises and the feasibility of human resource transforming into human capital were also discussed. The transformation of human resources into human capital shows that labor has played its own role in the production system. The employee is not only an important condition for enterprise growth, but it can also promote the progress of science and technology and increase the efficiency of the productivity.
TL;DR: Zhang et al. as mentioned in this paper analyzed the impact of capital deepening on the regional economic development gap and found that capital deepening does not directly affect the regional development gap but indirectly affects the regional developing gap by affecting the labor income share.
Abstract: At the same time as economic development, the imbalance problem in regional economic development is prominent, which hinders sustainable economic development, especially in China. Explaining the causes of unbalanced regional economic development is an important scientific problem in current economic research. Here, this study takes China as the empirical research area and uses China’s inter-provincial panel data to deeply analyze the impact of capital deepening on the regional economic development gap. As indicated by this study, after a series of potential factors (e.g., industrial proportion, foreign direct investment, and per capita GDP) of the regional development gap are controlled, the capital deepening measured using perpetual inventory can have a strong explanatory power for the regional development gap, i.e., the greater the value of capital deepening, the more significant the regional development gap will be. According to the above conclusion, the effect arising from capital deepening on the regional development gap is still significant, even after the Soviet Aid Project is employed as the current instrumental variable of capital deepening, as well as after the data from the world sample are estimated The study further finds that capital deepening does not directly affect the regional development gap but indirectly affects the regional development gap by affecting the labor income share. Therefore, a higher labor share can narrow the regional development gap.
TL;DR: Zhang et al. as discussed by the authors made an empirical study on the contribution of various input factors to economic growth in 36 OECD countries from 1990 to 2017, and found that the output elasticity of labor, physical capital, human capital and human capital input factors is statistically significant, indicating that input has an important impact on economic growth.
Abstract: Abstract Background Promoting the sustained and stable growth of the national economy is the eternal goal of economic theory researchers and policy makers. So, what is the fundamental source of promoting a country's sustainable economic growth? Research Objects and Methods From the perspective of labor, physical capital, human capital and total factor productivity, this paper makes an empirical study on the contribution of various input factors to economic growth in 36 OECD countries from 1990 to 2017. In order to analyze the impact of this strategy on the change of livelihood capital on emotion, and provide effective measures and basis for alleviating psychological pressure. In this study, 500 subjects in Southwest China were investigated with Depression Anxiety Stress Scale (DASS-21). Results The results show that: (1) the output elasticity of labor, physical capital and human capital input factors is statistically significant, indicating that input has an important impact on economic growth. (2) The total contribution share of investment accounts for about 1 / 3, of which labor force accounts for about 24%, and the proportion of physical capital and human capital accounts for 5% and 6% respectively is similar and relatively small. (3) Total factor productivity (TFP) is the most important driving force of economic growth, accounting for 2 / 3 of economic growth. (4) The contribution of labor and material capital showed a slow upward trend, the contribution of human capital was basically stable, and the contribution of total factor productivity showed a slow downward trend. (5) Exploring the sources of economic growth has important policy implications not only for OECD countries but also for developing countries. Taking the emotional grouping as the independent variable, the group conducted a one-way multivariate analysis of variance on the fluency and novelty of aut, box's M = 24.05, P < 0.001. The result shows that the data is not suitable for multivariate analysis of variance, so the emotional grouping is used as the independent variable to analyze the fluency and novelty of aut by one-way ANOVA respectively. Specifically, the main effect of emotion on aut fluency is significant, f (2, 99) = 6.43, P = 0.002, η 2 p= 0.12. Post hoc comparison showed that the anger group (M = 11.26, SD = 6.20) was higher than the neutral emotion group (M = 7.26, SD = 3.44, P = 0.002, Cohen's d = 0.80), with no other significant difference (see Figure 2D). The main effect of emotion on the novelty of aut was significant, f (2, 99) = 7.84, P < 0.001, η 2 p = 0.14. Post hoc comparison showed that the anger group (M = 15.29, SD = 8.85) was higher than the sadness group (M = 11.21, SD = 5.50, P = 0.042, Cohen's d = 0.55) and the neutral emotion group (M = 8.91, SD = 5.23, P = 0.001, Cohen's d = 0.88). Conclusion All sectors of society should fully understand the importance of emotional factors of relevant groups in rehabilitation, actively improve the surrounding environment and the respective roles of both sides, pay special attention to their own virtual technology language and behavior, and shift from single display to multi-dimensional management, coordinator and collaborator. In the process of output, actively present personalized psychology to patients, flexibly organize activities, strive to create a relaxed and harmonious rehabilitation atmosphere, create a friendly and mutual aid business environment, encourage and guide patients to adjust their psychology to the best state. Acknowledgements The work is supported by Open Fund Project of Research Center for Economy of Upper Reaches of the Yangtse River of Chongqing Technology and Business University (KFJJ2018002). The author is highly grateful to the editor and anonymous referees for their valuable comments and constructive suggestions which help to improve the present form of this paper.
01 Jan 2022
TL;DR: In this article , the authors used Barro regression to test the hypothesis that human capital agglomeration affects China's interregional income inequality from 1991 to 2004, and they found that workers with high levels of human capital are concentrated, both production activities and trade by foreign capital are promoted, resulting in increased economic growth rates.
Abstract: This chapter uses Barro regression to test the hypothesis that human capital agglomeration affects China‘s interregional income inequality from 1991 to 2004. The analysis in this chapter shows that, first, absolute βconvergence was not significantly measured during the 1991–2004 estimation period. Second, when the human capital agglomeration effect is considered, conditional convergence and the estimated values of the coefficients of foreign investment and trade effects on regional economic development are also significant. These results indicate that in coastal regions where workers with high levels of human capital are concentrated, both production activities and trade by foreign capital are promoted, resulting in increased economic growth rates. However, the outflow of workers with high levels of human capital resulted in lower economic growth rates. As a result, we can conclude that the period’s human capital agglomeration effect increases the income inequality between regions.
17 Aug 2022
TL;DR: In this paper , the authors analyzed the heterogeneous direct and spillover effect of capital control on gross capital flows across three major institutional sectors, namely public, banks and corporate, using spatial econometric models.
Abstract: Abstract Capital control is used as policy toolkit for safeguarding domestic economy from the volatility of capital flows. However, the effect of capital control is rather far fetched as the signaling effect of capital control can moderate investor’s outlook about domestic economy and thereby outweighs the intended effect. The spillover effect, on the other hand, modulates the capital flows to other countries when one country increases capital account restrictions. Further, the effect of capital control can have varying impact on capital inflows to different sectors as recent studies indicate heterogeneity in the drivers and nature of capital inflows to different institutional sectors. With the background, the paper analyzes the heterogeneous direct and spillover effect of capital control on gross capital flows across three major institutional sectors namely public, banks and corporate. The paper validates the possible heterogeneity in the effect of capital control on the capital inflows to these institutional sectors using spatial econometric models. The paper observes that the direct effect of capital control moderates portfolio inflows to public sector whereas the effect is insignificant on portfolio inflows to banks and corporate sector. Further, the paper observes that the spillover effect of capital control is broad-based i.e. equally prevalent on all sectors. The paper explains the heterogeneity in the capital control effects by introducing signaling effect in a portfolio choice model. The paper argues that the heterogeneous direct effect is driven by private signals of capital control received by the investors about the state of economy whereas the spillover effect of capital control is mainly driven by the hedging and search for better returns. The paper extends the existing literature of capital controls by reviewing the sectoral heterogeneity in the capital flows.
TL;DR: In this paper , the impact of capital growth in information and communication technology (ICT) on economic growth in one developing country, Egypt, which has been heavily investing in the sector of ICT, was analyzed using an error correction model.
Abstract: Capital investments in information and communication technology (ICT) have been a major contributor to the growth of several developed countries. In an attempt to boost their economies, some emerging and developing countries have been following a similar path, in which they heavily invest in the sector of ICT. However, due to other factors, ICT capital growth may not always produce the desired economic outcome. The purpose of this study is to estimate the impact of capital growth in ICT on economic growth in one developing country, Egypt, which has been heavily investing in the sector of ICT. The study analyses time series data covering the period from 1999 to 2019 using an error correction model. The findings demonstrate that there is no long-term positive association between ICT capital growth and economic growth in Egypt. While the development of ICT provides the potential for Egypt to achieve sustained economic growth, the significance and size of these impacts are currently negligible. The study concludes that in order to benefit from capital investments in ICT, policymakers should enact high-quality investment policies and improve the overall quality of the surrounding environment, such as the regulatory and institutional environments, in addition to controlling inflation and government consumption
TL;DR: In this paper , the authors adopt a simple model of endogenous growth with polluting capital and a fixed budget for aggregate emissions, and find that long-run capital and consumption are inversely related to the initial capital stock.
Abstract: Abstract We adopt a simple model of endogenous growth with polluting capital and a fixed budget for aggregate emissions. Pollution abatement efficiency is growing over time due to technical progress. We find that long-run capital and consumption are inversely related to the initial capital stock. Capital taxation does not harm the economy but actually raises long-run consumption and production, which we call the “capital tax paradox.” The reason for this surprising result is that in an economy with a binding carbon policy, early abundance of polluting capital is not a blessing but a curse. It is preferable to have a large capital stock when abatement efficiency has grown sufficiently large. The paper also provides novel results on the impact of pollution intensity and the rate of technical progress on the greening of the economy and the pollution permit prices. In the quantitative part, we calibrate model and study economic growth under different assumptions on the basic model parameters.
TL;DR: In this article , the authors studied the macroeconomic theory of economic growth in complicated case, when technical progress is materialized in capital and showed that this equation differs seriously from similar ordinary differential equation for capital-labour ratio.
Abstract: The article studies the macro-economic theory of economic growth Solow in complicated case, when technical progress is materialized in capital. In this situation the production function depends on effective capital and labour resource. The authors research in detail the efficiency of capital. As a rule differential equation of balance for the capital is deduced on the basis of the principle economic identity: profit, i. e. output of industrial products is equal to the sum total of consumption and investment. On the basis of ordinary differential equation of balance for the capital it is possible to obtain the ordinary differential equation for capital-labour ratio. The rates of capital efficiency growth, labour reserve, norms of accumulation and rates of capital amortization are set exogenously. The research shows that this equation differs seriously from similar ordinary differential equation for capital-labour ratio in case technical progress is materialized in labour.
TL;DR: In this paper , the effects of international capital mobility on innovation, growth, and optimal growth policies in a small open economy with R&D-driven growth were examined, and it was shown that the economy can reach a higher growth rate if international capital is more mobile.
Abstract: In this paper, we examine the effects of international capital mobility on innovation, growth, and optimal growth policies in a small open economy with R&D-driven growth. Households can borrow funds from an imperfect international capital market to finance their investment in R&D firms. We show that the economy can reach a higher growth rate if international capital is more mobile. This result is consistent with recent empirical findings. Moreover, we show that the common growth-enhancing policies, such as patent protection and the R&D subsidies, have an additional negative welfare effect when households can access the international capital market. Accordingly, the optimal patent protection and R&D subsidy should be smaller when the degree of international capital mobility is higher.
02 Dec 2022
TL;DR: In this paper , the authors examined the conditions necessary for the effective functioning of infrastructure management and monetary control policies in a seigniorage dependent economy based on an overlapping generations model and analyzed the relationship between the ratio of private capital to public capital and changes in the general price level.
Abstract: Abstract This study examines the conditions necessary for the effective functioning of infrastructure management and monetary control policies in a seigniorage dependent economy based on an overlapping generations model. Moreover, we analyze the relationship between the ratio of private capital to public capital and changes in the general price level. The results show that when the monetary growth rate that maximizes the gross domestic product (GDP) growth rate is selected, the elasticity of the ratio of private capital to public capital with respect to monetary growth depends on the private capital elasticity of GDP. If maximizing social welfare is equivalent to maximizing economic growth, the elasticity of the ratio of private capital to public capital with respect to the share of expenditure on infrastructure investment is zero. When the initial value of the ratio of private capital to public capital is at a sufficiently low (high) level, inflation (deflation) occurs during the transition path. JEL classification: E52; H54; O40
18 Dec 2022
TL;DR: In this article , the effect of capital flight from Turkey on its economic growth during 1981-2019 was investigated and the authors employed the Johansen cointegration approach to determine whether there exists an association between flight capital and the output growth of Turkey in the long run.
Abstract: Capital flight from Turkey throughout the last few decades is one of the major policy concerns for the development prospects of the economy. Several studies address the issue of capital flight from Turkey, but there is no significant study that examines its impact on the economic growth of the economy. The study investigates the effect of capital flight from Turkey on its economic growth during 1981-2019. It measures the extent of capital flight from Turkey adopting the World Bank’s residual method and examines its growth effect in a setting of Barro’s growth model. The study employs the Johansen cointegration approach to determine whether there exists an association between flight capital and the output growth of Turkey in the long run. The study results support the view that the flight of capital from Turkey deteriorates the country’s output growth in the long run. It implies that the government should adopt policies to reduce capital flight, increase domestic investment, and stimulate economic growth.
IIUC Business Review Vol. 9, Dec. 2020 pp. 9-26
TL;DR: In this article , the authors make human capital accumulation subject to a regulation that can completely offset the diminishing effect of physical capital marginal output and keep it at a reasonable level, which is called "regulated" accumulation.
Abstract: Human capital, as an important factor of production, directly promotes economic growth. On the other hand, it indirectly promotes economic growth by stimulating the accumulation of physical capital and improving the level of technological innovation. Therefore, human capital is the fundamental reason for economic growth. The key to make human capital play a long-term role is to correctly set the human capital accumulation equation. Different from the existing articles that set human capital accumulation equation from the perspective of human capital investment and physical capital investment, this paper focuses on the marginal output of physical capital. Based on the marginal output of physical capital, this paper makes human capital accumulation subject to a regulation that can completely offset the diminishing effect of physical capital marginal output and keep it at a reasonable level. This way of human capital accumulation is called “regulated” accumulation. The derivation of theoretical model proves that the regulated human capital accumulation, which is based on constant marginal output of physical capital, enables the growth rate of output to be constant and positive. Therefore, this paper finds the source of long-term economic growth from aspect of human capital. As the embodiment of a country’s comprehensive strength and core competitiveness, human capital has important strategic significance and great potential in China’s sustainable economic development. Regulated human capital accumulation can provide a new driving force for China’s economic growth and promote long-term development.
TL;DR: In this article , the authors evaluate human capital and its efficiency based on the indicators of average and marginal productivity in the regions of Russia, taking into account the presence of digital competencies necessary for the modern economy.
Abstract: The purpose of this work is to evaluate human capital and its efficiency based on the indicators of average and marginal productivity in the regions of Russia. The assessment of human capital was made by taking into account the presence of digital competencies necessary for the modern economy. The average productivity of human capital is defined as the ratio of the gross regional product per employee to the indicator of human capital. The marginal productivity of human capital is defined as the ratio of the relative change in the gross regional product per employee to the absolute change in human capital. Based on these results, the regional differentiation of the efficiency of the utilisation of human capital is characterized and recommendations for its reduction are proposed.