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MaGE 3.1: Long-term macroeconomic projections of the World economy

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  • Fontagné, Lionel
  • Perego, Erica
  • Santoni, Gianluca

Abstract

What will the global economy look like in a generation? The answer depends on the multiple forces driving long-term growth (demography, education, diffusion of technical progress, energy costs, investment and saving behaviour, international capital mobility) and requires a comprehensive framework to conceptualize them. We re-estimate the three-factor (capital, energy, labour) MAcro-econometric model of the Global Economy (MaGE), initially developed by Fouré et al. (2013), with a database covering 170 countries using state-of-the-art methods. We thus establish the long-term structural relationships that drive the dynamics of the World economy. The model projections to 2050 illustrate the expected changes in the World economy and their driving forces. In light of the projected volume of energy consumption, making these projections compatible with climate imperatives calls for increased technology sharing at the international level in order to decouple economic growth from energy use.

Suggested Citation

  • Fontagné, Lionel & Perego, Erica & Santoni, Gianluca, 2022. "MaGE 3.1: Long-term macroeconomic projections of the World economy," International Economics, Elsevier, vol. 172(C), pages 168-189.
  • Handle: RePEc:eee:inteco:v:172:y:2022:i:c:p:168-189
    DOI: 10.1016/j.inteco.2022.08.002
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    More about this item

    Keywords

    Growth models; Long-term growth; Energy use; Total Factor Productivity; Energy efficiency;
    All these keywords.

    JEL classification:

    • O - Economic Development, Innovation, Technological Change, and Growth
    • E01 - Macroeconomics and Monetary Economics - - General - - - Measurement and Data on National Income and Product Accounts and Wealth; Environmental Accounts
    • F01 - International Economics - - General - - - Global Outlook
    • F64 - International Economics - - Economic Impacts of Globalization - - - Environment

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