Truth and robustness in cross-country growth regressions

Published

Journal Article (Review)

We re-examine studies of cross-country growth regressions by Levine and Renelt (American Economic Review, Vol. 82, 1992, pp. 942-963) and Sala-i-Martin (American Economic Review, Vol. 87, 1997a, pp. 178-183; Economics Department, Columbia, University, 1997b). In a realistic Monte Carlo experiment, their variants of Edward Leamer's extreme-bounds analysis are compared with a cross-sectional version of the general-to-specific search methodology associated with the LSE approach to econometrics. Levine and Renelt's method has low size and low power, while Sala-i-Martin's method has high size and high power. The general-to-specific methodology is shown to have a near nominal size and high power. Sala-i-Martin's method and the general-to-specific method are then applied to the actual data from Sala-i-Martin's original study.

Full Text

Duke Authors

Cited Authors

  • Hoover, KD; Perez, SJ

Published Date

  • January 1, 2004

Published In

Volume / Issue

  • 66 / 5

Start / End Page

  • 765 - 798

International Standard Serial Number (ISSN)

  • 0305-9049

Digital Object Identifier (DOI)

  • 10.1111/j.1468-0084.2004.101_1.x

Citation Source

  • Scopus