Why Run a Million Regressions? Endogenous Policy and Cross Country Growth Empirics

Arbeitspapier

This paper analyzes the link between growth and public policy when the latter depends on economically important fundamentals. When policy is endogenous the measured effects of policy on growth will generally be biased. Using a widely quoted theoretical model, the signs of the biases are derived. It is shown that the usually reported effects on growth of tax rate variables related to GDP, the ratio of public investment to total investment and the ratio of redistributive transfers to GDP are generally biased downwards. Based on these signed biases the paper discusses some empirical results that seem puzzling from a theoretical viewpoint.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: Darmstadt Discussion Papers in Economics ; No. 140

Klassifikation und Themen

• Klassifikation: Wirtschaft
• Thema: Growth ; Public Policy ; Cross-Sectional Models ; Wirtschaftswachstum ; Finanzpolitik ; Regression ; Bias ; Theorie ; Cross-Sectional Model

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Rehme, Günther
• Ereignis: Veröffentlichung
• (wer): Technische Universität Darmstadt, Department of Law and Economics
• (wo): Darmstadt
• (wann): 2004

Weitere Informationen

• Handle: http://hdl.handle.net/10419/22523
• Letzte Aktualisierung: 10.03.2025, 11:44 MEZ