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Human Capital, Trade Openness and Growth in Argentina in the 20th Century
Author(s) -
Véganzonès MarieAnge,
Winograd Carlos
Publication year - 1998
Publication title -
labour
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.403
H-Index - 34
eISSN - 1467-9914
pISSN - 1121-7081
DOI - 10.1111/1467-9914.00070
Subject(s) - openness to experience , human capital , economics , total factor productivity , convergence (economics) , endogenous growth theory , productivity , production (economics) , production function , divergence (linguistics) , estimation , growth accounting , capital (architecture) , econometrics , macroeconomics , international trade , economic growth , geography , psychology , social psychology , linguistics , philosophy , management , archaeology
We estimate a production function that accounts for the economic performance of the country in the 20th century. We elaborate long term time series whereas most of the recent empirical studies on growth are based on cross section analysis. This approach allows us to follow the various regime changes that can be identified in the rich economic history of Argentina. To evaluate Total Factor Productivity (TFP) we initially test the classical Solow Model. We estimate the speed of convergence of TFP and obtain a non convergence result. This speed of convergence has declined since the 1930s, and we find a phenomenon of divergence in the period 1970–90. We then analyse the impact on production of additional variables recently highlighted in the endogenous growth literature such as the process of catch up of foreign technical progress, human capital and trade openness. Chow tests for this extended production function give us a strong probability of changes in the growth regimes. The estimation, that takes into consideration the break points identified, shows that the impact of trade openness and foreign technology is not stable throughout the century. In what concerns the impact of education on economic growth, we find a strong effect of primary education on growth, and a weaker effect of secondary‐university education.