Determinants of Long-Term Economic Growth Redux: A Measurement Error Model Averaging (MEMA) Approach

62 Pages Posted: 18 Jan 2017

See all articles by Gernot Doppelhofer

Gernot Doppelhofer

Norwegian School of Economics (NHH) - Department of Economics

Ole-Petter Hansen

Norwegian School of Economics (NHH) - Department of Economics

Melvyn Weeks

University of Cambridge - Faculty of Economics and Politics

Date Written: December 21, 2016

Abstract

This paper estimates determinants of long-run growth rates of GDP per capita in a cross section of countries. We propose a novel Measurement Error Model Averaging (MEMA) approach that accounts for measurement error in international income data as well as model uncertainty. Estimating the model using eight vintages of the Penn World Tables (PWT) together with other proposed growth determinants, we identify 18 variables related to economic growth. The results are robust to allowing for outliers in the form of heteroscedastic model errors.

Keywords: Growth regression, robust growth determinants, measurement error, Bayesian modelling

JEL Classification: C11, C82, E01, O47

Suggested Citation

Doppelhofer, Gernot and Hansen, Ole-Petter and Weeks, Melvyn, Determinants of Long-Term Economic Growth Redux: A Measurement Error Model Averaging (MEMA) Approach (December 21, 2016). NHH Dept. of Economics Discussion Paper No. 19/2016, Available at SSRN: https://ssrn.com/abstract=2901346 or http://dx.doi.org/10.2139/ssrn.2901346

Gernot Doppelhofer (Contact Author)

Norwegian School of Economics (NHH) - Department of Economics ( email )

Helleveien 30
N-5035 Bergen
Norway

Ole-Petter Hansen

Norwegian School of Economics (NHH) - Department of Economics ( email )

Helleveien 30
N-5035 Bergen
Norway

Melvyn Weeks

University of Cambridge - Faculty of Economics and Politics ( email )

Austin Robinson Building
Sidgwick Avenue
Cambridge, CB3 9DD
United Kingdom

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