Growth Regressions and Economic Theory
Tinbergen Institute Discussion Paper No. 2002-034/2
9 Pages Posted: 19 Apr 2002
Date Written: 2002
In this note we show that the standard, loglinear growth regression specification is consistent with one and only one model in the class of stochastic Ramsey models. This model is highly restrictive: it requires a Cobb-Douglas technology and a 100% depreciation rate and it implies that risk does not affect investment behavior.
Keywords: economic growth, growth regressions, growth under uncertainty
JEL Classification: O4, D91
Suggested Citation: Suggested Citation