Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/109240 
Year of Publication: 
2002
Series/Report no.: 
ERD Working Paper Series No. 19
Publisher: 
Asian Development Bank (ADB), Manila
Abstract: 
"This paper provides evidence of a problem with the influential testing and assessment of Solow's (1956) growth model proposed by Mankiw et al. (1992) and a series of subsequent papers evaluating the latter. First, the assumption of a common rate of technical progress maintained by Mankiw et al. (1992) is relaxed. Solow's model is extended to include the different levels and rates of technical progress of each country. This increases the explanatory power of the cross-country variation in income per capita of the OECD countries to over 80 percent. The estimates of the parameters are statistically significant and take the expected values and signs. Second, and more important, it is shown that the estimates merely reflect a statistical artifact. This has serious implications for the possibility of actually testing Solow's growth model. "
Persistent Identifier of the first edition: 
Creative Commons License: 
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Document Type: 
Working Paper

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