When Does Domestic Savings Matter for Economic Growth?
Résumé
Can a country grow faster by saving more? The paper addresses this question both theoretically and empirically. In the theoretical model, growth results from innovations that allow local sectors to catch up with frontier technology. In poor countries, catching up requires the cooperation of a foreign investor who is familiar with the frontier technology and a domestic entrepreneur who is familiar with local conditions. In such a country, domestic savings matters for innovation, and therefore growth, because it enables the local entrepreneur to put equity into this cooperative venture, which mitigates an agency problem that would otherwise deter the foreign investor from participating. In rich countries, domestic entrepreneurs are already familiar with frontier technology and therefore do not need to attract foreign investment to innovate, so domestic savings does not matter for growth.
A cross-country regression shows that lagged savings is positively associated with productivity growth in poor countries but not in rich countries.
Domaines
Economies et financesFormat du dépôt | Notice |
---|---|
Type de dépôt | Article dans une revue |
Titre |
en
When Does Domestic Savings Matter for Economic Growth?
|
Résumé |
en
Can a country grow faster by saving more? The paper addresses this question both theoretically and empirically. In the theoretical model, growth results from innovations that allow local sectors to catch up with frontier technology. In poor countries, catching up requires the cooperation of a foreign investor who is familiar with the frontier technology and a domestic entrepreneur who is familiar with local conditions. In such a country, domestic savings matters for innovation, and therefore growth, because it enables the local entrepreneur to put equity into this cooperative venture, which mitigates an agency problem that would otherwise deter the foreign investor from participating. In rich countries, domestic entrepreneurs are already familiar with frontier technology and therefore do not need to attract foreign investment to innovate, so domestic savings does not matter for growth.
A cross-country regression shows that lagged savings is positively associated with productivity growth in poor countries but not in rich countries.
|
Auteur(s) |
Philippe Aghion
1, 2, 3, 4
, Diego Comin
5
, Peter Howitt
6
, Isabel Tecu
6
1
Harvard University
( 38302 )
- Massachusetts Hall, Cambridge, MA 02138
- États-Unis
2
PSE -
Paris-Jourdan Sciences Economiques
( 139754 )
- 48 boulevard Jourdan 75014 Paris
- France
3
PSE -
Paris School of Economics
( 301309 )
- 48 boulevard Jourdan 75014 Paris
- France
4
Collège de France - Chaire Economie des institutions, de l'innovation et de la croissance
( 1043633 )
- 11 place Marcelin Berthelot F-75231 Paris Cedex 05
- France
5
Dartmouth College [Hanover]
( 19043 )
- Hanover, NH 03755 USA
- États-Unis
6
Brown University
( 236317 )
- Providence, Rhode Island 02912
- États-Unis
|
Langue du document |
Anglais
|
Date de production/écriture |
2016-08
|
Nom de la revue |
|
Vulgarisation |
Non
|
Comité de lecture |
Oui
|
Audience |
Internationale
|
Date de publication |
2016-08
|
Volume |
64
|
Numéro |
3
|
Page/Identifiant |
381 - 407
|
Domaine(s) |
|
Mots-clés |
en
Economic growth
|
DOI | 10.1057/imfer.2015.41 |
Loading...