Externalities and Interdependent Growth: Theory and Evidence

Economics working paper 194

27 Pages Posted: 12 May 1997

See all articles by Antonio Ciccone

Antonio Ciccone

Universitat Pompeu Fabra - Faculty of Economic and Business Sciences; Centre for Economic Policy Research (CEPR); Institute for the Study of Labor (IZA)

Date Written: October 1996

Abstract

I formulate and estimate a model of externalities within countries and technological interdependence across countries. I find that external returns to scale to physical capital within countries are 8 percent; that a 10 percent increase of total factor productivity of a country's neighbors raises its total factor productivity by 6 percent; and that a 2 percent annual growth rate of labor productivity can be explained as an endogenous response to an exogenous 0.2 percent annual growth rate of total factor productivity in the steady-state.

JEL Classification: E13, O1, O3, O4

Suggested Citation

Ciccone, Antonio, Externalities and Interdependent Growth: Theory and Evidence (October 1996). Economics working paper 194. Available at SSRN: https://ssrn.com/abstract=47585 or http://dx.doi.org/10.2139/ssrn.47585

Antonio Ciccone (Contact Author)

Universitat Pompeu Fabra - Faculty of Economic and Business Sciences ( email )

Ramon Trias Fargas 25-27
Barcelona, 08005
Spain
+34 93 542 1669 (Phone)
+34 93 542 1746 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Institute for the Study of Labor (IZA)

P.O. Box 7240
Bonn, D-53072
Germany

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