Openness, Human Development, and Fiscal Policies
Author | : Delano Villanueva |
Publisher | : International Monetary Fund |
Total Pages | : 36 |
Release | : 1993-07-01 |
ISBN-13 | : 9781451965780 |
ISBN-10 | : 1451965788 |
Rating | : 4/5 (88 Downloads) |
Download or read book Openness, Human Development, and Fiscal Policies written by Delano Villanueva and published by International Monetary Fund. This book was released on 1993-07-01 with total page 36 pages. Available in PDF, EPUB and Kindle. Book excerpt: The model developed here postulates that learning through experience plays a critical role in raising labor productivity over time, with three major consequences. First, the steady-state growth rate (of output) becomes endogenous and is influenced by government policies. Second, the speed of adjustment to steady-state growth is faster, and enhanced learning further reduces adjustment time. Third, both steady-state growth and the optimal net rate of return to capital are higher than the sum of exogenous rates of technical change and population growth. Simulation results confirm the model’s faster speed of adjustment, while regression analysis explains a large part of divergent growth patterns across countries in terms of the extent of openness and human development and of the quality of fiscal policies.