Per-capita Income Growth Research Articles

Can a negative population growth rate sustain a positive economic growth rate in the long run?

To better understand the long-term consequences and the possible channels (mainly, technological progress and human capital accumulation) through which a declining population may eventually sustain long-run economic growth and innovation in advanced economies, we build an endogenous, non-scale growth model with horizontal R&D activity and human capital investment. Population growth and per capita human capital accumulation are linked to each other by means of what in the paper is identified as the ‘multiplicative effect’ of population. As long as the strength of this effect exceeds a given positive threshold, population growth and per-capita income growth can be negatively correlated. This means that a negative rate of population growth can sustain a positive economic growth rate in the long run.

PENGARUH PERTUMBUHAN UMKM, INDEKS KETERBUKAAN PERDAGANGAN, PERTUMBUHAN PENDAPATAN PER KAPITA, DAN INDEKS PEMBANGUNAN MANUSIA TERHADAP PENGENTASAN KEMISKINAN DI 5 NEGARA ASEAN

This study aims to analyze the effect of MSME Growth, Trade Openness Index, Per Capita Income Growth, dan Human Development Index on Poverty Alleviation in 5 ASEAN Countries with the research period 2014-2019. The population of this study is poverty as measured in the proportion of the population below the poverty line. This study uses the Panel Data method, and the results show that there is no significant relationship between MSME Growth and Poverty Alleviation. Meanwhile, there is a significant relationship between the Trade Openness Index, Per Capita Income Growth, and the Human Development Index on Poverty Alleviation in 5 ASEAN Countries

Water Infrastructure Performance in Sub-Saharan Africa: An Investigation of the Drivers and Impact on Economic Growth

There is a strong link between water infrastructure and development outcomes. As such, water infrastructure challenges could have an adverse effect on the economy at large. This study investigates the drivers of water infrastructure performance and analyzes how investment in water infrastructure affects economic growth, focusing on a panel of thirty-one Sub-Saharan African (SSA) countries. An integrative theoretical framework using panel regressions was developed. The result showed that an increase in water infrastructure performance due to a 1% increase in per-capita income growth and trade openness was 0.2% and 0.03%, respectively, and the constraint on water infrastructure performance due to a 1% increase in population density was 0.76%. The result showed that the impact is mostly driven by the effect of per-capita income growth and population density on lower- and middle-income countries. Our results also revealed that one additional increase in water infrastructure investment leads to a higher impact on economic growth. We further complement our study by investigating the policy interventions that the support water infrastructure outcome effect. We found that investment in water infrastructure along with the provision of credit to the private sector is a strong driver of economic growth; however, access to credit beyond a certain threshold—relative to the level of investment in water infrastructure in these countries—investment in water infrastructure would lead to an adverse negative macroeconomic effect. The policy implications of this study are discussed.

Corruption and Economic Growth in Kenya: A County-level Analysis

While there's an outsized consensus within the empirical literature on the negative impact of corruption on the economic process, some studies still argue that corruption could also be economically justified. There is, however, little empirical evidence to validate the impact of corruption on economic growth within the devolved units. The effect of the corruption rate on economic activities is examined using ordinary least squares regression analysis and Kenya county-level data. The results of this study revealed that there exists a negative independent relationship between corruption and county per-capita income growth. Arising from the study findings, this study submits that the county authorities and policymakers must put in situ policies that may eradicate the grounds for bribe-taking in counties to stimulate economic growth. Keywords: corruption, economic growth, fiscal decentralization, devolution, macroeconomic DOI: 10.7176/JESD/12-18-02 Publication date: September 30 th 2021

Industry Affiliation and the Value of Portfolio Choice

Using CES earnings data, I estimate the private, risk-adjusted value of industry-specific human capital for employees in 72 industries. For each industry, I obtain the certainty equivalent income, which renders an individual indifferent between receiving and consuming this income and implementing the optimal consumption and portfolio choice decisions that solve the average Euler equations for employees in that industry. Depending on the industry of employment, every dollar initially earned is worth between 86 and 99 cents, when adjusted for the risks in industry-specific per-capita income growth, and the potential to hedge these risks with investments in the aggregate stock market. Inter-industry differences in certainty equivalent income per dollar of initial earnings can be explained by cross-sectional variation in the time series moments of the joint distribution of income growth and stock return. Cokurtosis, the tendency to generate left skewness in per-capita income growth in recessions, is as important as correlation.

Pengaruh Tenaga Kerja (Human Capital) Dan Daya Dorong Investasi Terhadap Pertumbuhan Ekonomi Provinsi Papua (Studi Kasus)

The economic development efforts of the Papua province should focus on increasing employment opportunities and increasing investment as a stimulus to economic growth, thereby distributing community opportunities in every productivity Can be acquired for community welfare and economic development. Therefore, each autonomous region has the freedom to develop all potential and assets owned, especially the potential of natural resources that can be used as a mainstay asset in the development of regional economies in general. Therefore, it is necessary to analyze how the influence of Labour (Human Capital) and the power of investment in economic growth in Papua province (case study).The results showed that: the provision of employment opportunities in the Papua province is influenced by investment and real investment affects the provision of employment opportunities. This is because there is a lot of investment supported by the Government through a development financing budget that use more oriented to the development of sectors that are less absorbing workforce. Investment and Labour, both have no positive effect on the percapita income and economic growth.

Quantifying Demographic Dividend in India and its Impact on Economic Growth : A State-Level Study

Analyzing the impact of the age-structural changes on economic growth has gained immense attention over the recent years. The present study examined the relationship between changes in the working-age population ratio and per-capita income growth. After instrumenting growth rate of working-age population ratio with birth rate at the beginning of the previous decade, working-age population (both in level and growth form) appeared to have a positive and statistically significant impact on per-capita income growth. The log of working-age population ratio was found to be robust to the inclusion of several human capital development and other policy measures such as infant mortality rate, log of per-capita development expenditure, and per-capita scheduled commercial bank credit. Moreover, growth rate of working-age population ratio was found to be robust to inclusion of infant mortality rate and per-capita scheduled commercial bank credit. At an all-India level, the addition to the per-capita income growth due to changes in the working-age population ratio from the base year (1981) onwards was found to be gradually increasing over the decades and for the period 2000s, it turned out to be almost equal to 1%. High growth rate of working-age population ratio experienced by the BIMARU states, especially over the period 2001-2011, exhibited enormous potential of contributing to the per-capita income growth. A differential lens in policy making needs to be adopted. While states with narrow window of demographic opportunity should focus on policies that are inter-state migration friendly, states with broader window of demographic opportunity should invest more in human capital development and employment generation.

Trends in affordability of tobacco products before and after the transition to GST in India

ObjectiveTo estimate the trends in affordability of bidis, cigarettes and smokeless tobacco (SLT) in India and examine the impact of transition from the earlier indirect taxation system to the new...

A Comparison of Living Standards Across the States of America

We use an expected utility framework to examine how living standards, or welfare, vary across the U.S. and how each state’s welfare has evolved over time. Our welfare measure accounts for cross-state variations in mortality, consumption, education, inequality, and cost of living. While per-capita income is a good indicator of welfare (correlation=0.80), welfare in most states appears closer to that in the richest state than their difference in per-capita income would suggest. Whereas high-income states benefit from higher life expectancy, consumption, and college attainment, low-income states benefit from lower cost of living. All states experienced positive welfare growth from 1999 to 2015, but the annual welfare growth rate varied from 1.38 to 3.76 percent across states due to varying gains in life expectancy, consumption, and college attainment. Per-capita income growth and welfare growth are only weakly correlated (correlation=0.38) and deviations are often large. The welfare results are robust to several modifications such as allowing for endogenous migration across states and including gender, race, and leisure in the welfare measure.

How Does Governance Modify the Relationship between Public Finance and Economic Growth: A Global Analysis

How Does Governance Modify the Relationship between Public Finance and Economic Growth: A Global Analysis

Urban Growth, Land-use Efficiency and Local Socioeconomic Context: A Comparative Analysis of 417 Metropolitan Regions in Europe.

The present study presents a multidimensional analysis of land-use efficiency in terms of per-capita built-up area over 417 metropolitan regions from 27 European countries. The study period encompasses two urban phases including economic expansion (2000-2007) and crisis (2008-2015). Multiple geographical gradients were identified as relevant predictors of land-use efficiency across Europe. The socioeconomic variables most associated with high land-use efficiency were per-capita disposable income (in Western, Atlantic and Central Europe) and income growth during 2000-2007 (in Eastern Europe), indicating that wealthier cities are characterized by higher land-use efficiency. Land-use efficiency increased in contexts with diversified urban landscapes.

Contribution of demography to economic growth

From 1850 to 2000, in Western European countries life expectancy rose from 30–40 to 80 years and the average number of children per woman fell from 4 to 5 children to slightly more than one. To gauge the economic consequences of these demographic trends, we implement an overlapping generations model with heterogeneity by level of education in which individuals optimally decide their consumption of market- and home-produced goods as well as the time spent on paid and unpaid work. We find that around 17% of the observed increase in per-capita income growth from 1850 to 2000 was due to the demographic transition. Around 50% of the demographic contribution is explained by the increase in the average productivity per worker (productivity component), which arises from the change in the population’s age structure and the rise in households’ saving rate. The remaining 50% is explained by the higher growth rate of workers relative to the total population (translation component).

The impact of European Union accession on regional income convergence within the Visegrad countries

ABSTRACTThe impact of European Union accession on regional income convergence within the Visegrad countries. Regional Studies. This paper applies regional dynamic computable general equilibrium (CGE) models to simulate the growth of regional per-capita income within the Visegrad group of countries. It shows how regional income differentials would evolve in the Czech Republic, Hungary, Poland and Slovakia if they did not join the European Union. We find that all regions would grow at a slower pace without European Union membership and that the European Union structural policies play a key role here. Finally, we prove the impact of accession on the evolution of regional income inequalities, although its magnitude differs significantly between countries.

Speculative bubbles or market fundamentals? An investigation of US regional housing markets

This paper investigates the existence of speculative bubbles in the US national and 21 regional housing markets over three decades (1978–2015). A new method for real-time monitoring exuberance in housing markets is proposed. By taking changes in the macroeconomic conditions (such as interest rate, per-capita income, employment, and population growth) into consideration, the new method provides better control for housing market fundamentals and thereby it is expected to significantly reduce the chance of false positive identification. Compared with the method of Phillips et al. (2015a, 2015b), the new approach finds a dramatic reduction in the number of speculative housing markets and shorter bubble episodes in the US. It locates only one bubble episode in the early-to-mid 2000s over the whole sample period in the national housing market. At the regional level, it identifies two periods of speculation: late 1980s and early-to-mid 2000s. The early-to-mid 2000s bubble episode lasts longer and involves 16 metropolitan statistical areas.

Inflation Impact on the Primary Food Products - Emerging Trends and Determinants

India and its average food inflation during the period 2006-2013 was one of the highest among emerging market economies, and nearly double the inflation witnessed in during the previous decade. Present paper, I analysed the trend and major drivers of inflation factors for the food inflation. Study is both descriptive and analytical and entirely based on secondary data obtained from different published sources, authenticated source have been chosen without any personal bias. Analyze the data, percentages, growth rate and compounded annual growth rate were used to examine the major drivers of inflation and Ordinary Least Square Method and Trend analysis was used to calculate year over year growth rate. I observed from the analysis of WPI of all commodities was highly variable during the study period due to decadal growth rate showed decreasing trend, population continued to increase and growth of per-capita income has also increased. Despite declines in monthly Per Capita Consumer Expenditure, expenditures on food had increased which indicates a higher demand food in both urban and rural areas. Finally, results suggest that government should take effective measures to reduce the population, new economic policy which increased the demand for variety of food products and increase the agriculture productivity with low cost inputs.

Economic Growth and CO<sub>2</sub>-Emissions: What If Vietnam Followed China’s Development Path?

Vietnam and China both are quickly emerging market economies in Asia. China has had an unprecedented economic growth in Asia for the past 30 years. Also, Vietnam’s GDP is increasing, but more slowly. However, Vietnam is starting to catch up. Against this background, this article assesses the question what the economic and environmental impacts in Vietnam would be, if the country followed China’s development path. Based on econometric analysis, it is shown that currently, Vietnam is lagging behind China in terms of economic growth for 11 years. Although Vietnam and China have a similar primary energy mix in the early 1980s, China is still massively relying on coal, whereas Vietnam starts to develop hydro power in the late 1980s on large scale. Due to a quick growth of per-capita income, per capita emissions in China are already catching up with those of North-European economies such as Denmark, Finland and Germany. The question arises, what if Vietnam followed China’s development path. Using econometric models of GDP and CO2-emissions, two scenarios for Vietnam are analyzed, a scenario following China’s development path and one alternative scenario pursuing the current development patterns until 2050. The results show that the additional impact of following China’s economic development path is minor. Vietnam would only have a 0.5% percentage point per annum higher GDP growth. In other words, Vietnam would grow relatively quickly anyway. However, following China’s development path also in terms of high CO2-emissions per capita, would increase the growth of CO2-emissions in Vietnam by 2.3 percentage points per annum and would lead to an increase of CO2-emissions in 2050 by 2.6 bn. tons compared with the scenario in which Vietnam sticks to its own development patterns. However, in that case, Vietnam also had a 25% lower per capita income compared with the scenario following China’s development path. Here, the people and government in Vietnam have to make a strategic choice.

High-income does not protect against hurricane losses

Damage due to tropical cyclones accounts for more than 50% of all meteorologically-induced economic losses worldwide. Their nominal impact is projected to increase substantially as the exposed population grows, per capita income increases, and anthropogenic climate change manifests. So far, historical losses due to tropical cyclones have been found to increase less than linearly with a nation’s affected gross domestic product (GDP). Here we show that for the United States this scaling is caused by a sub-linear increase with affected population while relative losses scale super-linearly with per capita income. The finding is robust across a multitude of empirically derived damage models that link the storm’s wind speed, exposed population, and per capita GDP to reported losses. The separation of both socio-economic predictors strongly affects the projection of potential future hurricane losses. Separating the effects of growth in population and per-capita income, per hurricane losses with respect to national GDP are projected to triple by the end of the century under unmitigated climate change, while they are estimated to decrease slightly without the separation.

Oil resource abundance, institutions and growth: Evidence from oil producing African countries

The study interacted different measures of institutional quality and oil-resource abundance to determine if good institutions can reverse resource curse or enhance resource blessing in African oil rich countries. Result showed that institutional quality insignificantly enhanced per-capita income growth, thereby questioning institutional quality in these countries, but surprisingly, the interaction variables were negative and significant alluding to the fact that the quality of institutions in these countries would not be able to reverse the resource curse in these countries. It is therefore expedient to strengthen the quality of the institutions to sustain growth and enhance proper resource management in these countries.

Speculative Bubbles or Market Fundamentals? An Investigation of US Regional Housing Markets

This paper investigates the existence of speculative bubbles in the US national and in 23 regional housing markets over three decades (1978-2012). A new method for detecting exuberance in housing markets is proposed. By taking changes in the macroeconomic conditions (such as interest rate, per-capita income, employment, and population growth) into consideration, the new method provides a better control for housing market fundamentals and thereby it is expected to significantly reduce the chance of false positive identification. Compared with the method of Phillips, Shi and Yu (2015a,b), the new approach finds a dramatic reduction in the number of speculative housing markets and shorter bubble episodes in the US. It locates only one bubble episode in the early-to-mid 2000s over the whole sample period in the national housing market. At the regional level, it identifies three periods of speculation: late 1980s, early-to-mid 2000s, and the post-crisis period in 2011-2012. The early-to-mid 2000s bubble episode is the most severe one involving nine major metropolitan statistical areas.

Physical and Human Capital Complementarity and Worker Effort Level by Nutritional Level within Labor-Augmenting Solow Type Model

Whether the convergence occurs is one of the important issues in economic growth. Besides occurrence of convergence, another important issue in the theory of economic growth is whether the growth of per-capita income depends on the ratio of physical to human capital (K/H) where human capital is defined by the education and the worker effort level calculated by per capita dietary energy supply (DES). This study provides evidence for imbalance effects of (K/H) on growth rate besides convergence issue in a sample of 36 countries. This dependence causes the change in size of convergence rate where with the conditions on (K/H) ratio, convergence rate increases.