1,721,217 research outputs found
VIDEO de présentation du projet de recherche : David de la Croix (21/09/17)
No full textVidéo intégrale de la présentation du projet de recherche de David De la Croix (résident IMéRA/AMSE 2017-2018), enregistré le 21 septembre 2017 à l'IMéRA. "Did elite human capital trigger the industrial revolution? Insights from a new database of scholars from European universities " par David De la Croix (Full Professor of Economics, Université catholique de Louvain et résident IMéRA/AMSE 2017-2018). Période de résidence : 4 septembre - 29 décembre 2017 ; résidence AMSE/IMéR
Education and Growth with Endogenous Debt Constraints
Get PDFWhen future human capital cannot be alienated, households are allowed to borrow up to the point where it is in their own interest not to default. In such a framework, endogenous borrowing limits arise as the outcome of individual rationality constraint. In a model where education is the engine of growth, we show that endogenous borrowing constraints imply global indeterminacy. Comparing outcomes across the various equilibria we show that the relation between growth and yields is hump-shaped. Maximum growth can arise in an equilibrium with binding borrowing constraints, specially if the elasticity if human capital to education spending is large. Deepening financial markets promotes long-run growth in the case of a poverty trap, but not necessarily otherwise.Financial depth; borrowing constraints; indeterminacy; incentive compatibility
Investissement, incertitude de la demande et contraintes de capacités David de la Croix
No full textInvestition bei Nachfrageunsicherheit und Kapazitätszwängen,
von David de la Croix, Omar Licandro.
Durch Schätzung einer Investitionsfunktion des produzierenden Gewerbes in Belgien wird bei aleatorischer Nachfrage und bei Vorhandensein von Kapazitätszwängen die Stichhaltigkeit der Theorien des Tobin-q bewertet. Die Investition hàngt dann vom durchschnittlichen q und von den Vorwegnahmen des Kapazitätsausnutzungsgrads ab. Aus den Schätzungen geht hervor, daß durch die Einbeziehung des Kapazitätsausnutzungsgrads die Investitionsratengleichung wesentlich verbessert wird.Investment Under Demand Uncertainty and Capacity Constraints,
by David de la Croix and Omar Licandro.
The relevance of Tobin's q theory is evaluated under stochastic demand and capacity constraints by estimating a Belgian manufacturing investment function. Under these theoretical conditions, investment depends on average q and on the expectations about the degree of capacity utilization. The resulting estimates show that the introduction of the degree of capacity utilization as an additional explanatory variable significantly improves the investment rate equation.Investissement, incertitude sur la demande et contraintes de capacités,
par David de la Croix, Omar Licandro.
La pertinence des théories du ratio q de Tobin est évaluée en estimant une fonction d'investissement du secteur manufacturier belge, en considérant que la demande est aléatoire et en présence de contraintes de capacité. L'investissement dépend alors du q moyen et des anticipations du taux d' utilisation des capacités. Les estimations montrent que l'introduction du taux d'utilisation des capacités améliore significativement l'équation d'investissement.Inversiones, incertidumbre de la demanda e imperativos de capacidades,
por David de la Croix y Omar Licandro.
Se procede a la valoración de la pertinencia de las teorías del ratio q de Tobin evaluando una función de inversión del sector manufacturero belga, y considerando que la demanda es aleatoria y en presencia de imperativos de capacidad. La inversión dépende entonces de q de promedio y de las anticipations de la tasa de utilización de las capacidades. Las evaluationes muestran que la introducción de la tasa de utilización de las capacidades mejora de forma signifîcativa la ecuación de inversión.Licandro Omar. Investissement, incertitude de la demande et contraintes de capacités David de la Croix. In: Économie & prévision, n°106, 1992-5. Développements récents de la macro-économie. pp. 85-95
Growth, public investment and corruption with failing institutions. Working paper 2007-61, Society for the Study of Economic Inequality
No full textAbstract Corruption is thought to prevent poor countries from catching-up. We analyze one channel through which corruption hampers growth: public investment can be distorted in favor of specific types of spending for which rent-seeking is easier and better concealed. To study this distortion, we propose an optimal growth model where households vote for the composition of public spending subject to an incentive constraint reflecting individuals' choice between productive activity and rent-seeking. At equilibrium, the intensity of corruption and the structure of public investment are determined by the predatory technology and the distribution of political power. Among different regimes, the model shows a possible scenario of distortion without corruption in which there is no effective corruption yet still the possibility of corruption distorts the allocation of public investment, thus hampering growth. We test the implications of the model on a panel of countries estimating a system of equations with instrumental variables. We find that countries with a high predatory technology invest more in housing and physical capital in comparison with health and education. For equal initial conditions, such countries grow slower and have higher corruption, in particular when political power is concentrated. Keywords: Public investment, optimal growth, corruption, political power. JEL Classification numbers: O41, H50, D73. CORE Discussion Paper 2006/101. 1 Department of economics and CORE, Université catholique de Louvain. 2 Panthéon Sorbonne Economie, Université Paris 1, CNRS. Acknowledgements: David de la Croix acknowledges the financial support from the Belgian French speaking community (Grant ARC 03/08-235 "New macroeconomic approaches to the development problem") and the Belgian Federal Government (Grant PAI P5/21, "Equilibrium theory and optimization for public policy and industry regulation"). We are very grateful to Frédéric Docquier, Pierre Pestieau, James Stock and Dirk van de Gaer for helpful suggestions, and to Lennart Hoogerheide for a very detailed and useful internal referee report. We also thank the participants to the PET06 conference for comments
The Tradeoff Between Growth and Redistribution: ELIE in an Overlapping Generations Model
Get PDFThe ELIE scheme of Kolm taxes labour capacities instead of labour income in order to circumvent the distortionary effect of taxation on labour supply. Still, Kolm does not study the impact of ELIE on human capital formation and investment. In this paper, we build an overlapping generations (OLG) model with heterogenous agents and endogenous growth driven by investment in human capital. We study the effect of ELIE on education investment and other aggregate economic variables. Calibrating the model to French data, we highlight a tradeoff between growth and redistribution. With a perfect credit market, ELIE is successful in reducing inequalities and poverty, but it is at the expense of lower investment in education and slower growth. In an economy with an imperfect credit market where individuals cannot borrow to educate, the tradeoff between growth and redistribution is not overturned but is less severe. However, it is possible to overturn completely that trade-off simply by changing the base of taxation for the young generation which is equivalent to subsidising education.Education, Growth, Redistribution, Kolm
A Theory of Medecine Effectiveness, Differential Mortality, Income Inequality and Growth for Pre-Industrial England
Get PDFWe study how mortality reductions and income growth interact, looking at their relationship prior to the Industrial Revolution, when income per capita was stagnant. We first present a model of individual medical spending giving a rationale for individual health expenditures even when medecine was not effective in postponing death. We then explain the rise of effective medecine by a learning process function of expenditures in health. The rise in effective medicine can then be linked to the take-off of the eighteenth century through life expectancy increases, and fostered capital accumulation. The rise of effective medecine has also an impact on the relation between growth and inequality and on the intergenerational persistence of differences in income. These channels are operative through differential mortality induced by medecine effectiveness that turns out to determines a differential in the propensity to save among income groupsDifferential mortality, Life expectancy, Propensity to save, Health expenditures
Early Literacy Achievements, Population Density and the Transition to Modern Growth
Get PDFThe transition from economic stagnation to sustained growth is often modelled thanks to “population-induced” productivity improvements, which are assumed rather than derived from primary assumptions. In this paper the effect of population on productivity is derived from optimal behavior. More precisely, both the number and location of education facilities are chosen optimally by municipalities. Individuals determine their education investment depending on the distance to the nearest school, and also on technical progress and longevity. In this setting, higher population density enables the set-up costs of additional schools to be covered, opening the possibility to reach higher educational levels. Using conterfactual experiments we find that one third of the rise in literacy can be directly attributed to the effect of density, while one sixth is linked to higher longevity and one half to technical progress. Moreover, the effect of population density in the model is consistent with the available evidence from England, where it is shown that schools were established at a high rate over the period 1540-1620.Human Capital; Population Density; Education Investment;School Location;Technical Progress
Dynamics and monetary policy in a fair wage model of the business cycle
Get PDFWe first build a fair wage model in which effort varies over the business cycle. This mechanism decreases the need for other sources of sluggishness to explain the observed high inflation persistence. Second, we confront empirically our fair wage model with a New Keynesian model based on the standard assumption of monopolistic competition in the labor market. We show that, in terms of overall fit, the fair wage model outperforms the New Keynesian one. The extension of the fair wage model with lagged wage is judged insignificant by the data, but the extension based on a rent sharing argument including firm’s productivity gains in the fair wage is not. Looking at the implications for monetary policy, we conclude that the additional trade-off problem created by the inefficient real wage behavior significantly affect nominal interest rates and inflation outcomesEfficiency wage, effort, inflation persistence, monetary policy
Dynamics and monetary policy in a fair wage model of the business cycle
Get PDFWe first build a fair wage model in which effort varies over the business cycle. This mechanism decreases the need for other sources of sluggishness to explain the observed high inflation persistence. Second, we confront empirically our fair wage model with a New Keynesian model based on the standard assumption of monopolistic competition in the labor market. We show that, in terms of overall fit, the fair wage model outperforms the New Keynesian one. The extension of the fair wage model with lagged wage is judged insignificant by the data, but the extension based on a rent sharing argument including firm’s productivity gains in the fair wage is not. Looking at the implications for monetary policy, we conclude that the additional trade-off problem created by the inefficient real wage behavior significantly affects nominal interest rates and inflation outcomesEfficiency wage, effort, inflation persistence, monetary policy
Disentangling the demographic determinants of the English take-off: 1530-1860
Get PDFWe propose amodelwith some of themain demographic, economic and institutional factors usually considered to matter in the transition to modern growth. We apply our theory to England over the period 1530-1860. We use the model to measure the impact of mortality, population density and technological progress on school foundations, literacy and growth through a set of experiments. We find that one third of the rise in literacy over the period 1530-1850 can be directly related to the rise in population density, while one sixth is linked to higher longevity and one half to exogenous total factor productivity growth. Moreover, the timing of the effect of population density in the model is consistent with the available evidence for England, where it is shown that schools were established at a high rate over the period 1540-1620.
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