IDEAS home Printed from https://ideas.repec.org/a/sgh/annals/i26y2012p45-60.html
   My bibliography  Save this article

Bayesian Model Averaging in Modelling GDP Convergence with the Use of Panel Data

Author

Listed:
  • Mariusz Próchniak

    (Szkoła Główna Handlowa w Warszawie)

  • Bartosz Witkowski

    (Szkoła Główna Handlowa w Warszawie)

Abstract

In this paper, β convergence analysis for the 27 EU member countries and the 1993-2010 period is conducted. The analysis uses an Bayesian model averaging (BMA) approach applied to Blundell and Bond’s GMM system estimator with the existence of structural breaks. In order to account for the differences in the steady-states of the countries, 22 variables are tested as potential economic growth determinants. The structural breaks are expected to be in 1998 and 2004. The main finding is that the EU27 countries converged at the rate of about 5% per annum which is an enormous difference as compared with the widely cited 2% speed of convergence and the mechanism of conditional convergence was rather constant over time yet the influence of particular growth factors on GDP proved not to be stable anymore.

Suggested Citation

  • Mariusz Próchniak & Bartosz Witkowski, 2012. "Bayesian Model Averaging in Modelling GDP Convergence with the Use of Panel Data," Collegium of Economic Analysis Annals, Warsaw School of Economics, Collegium of Economic Analysis, issue 26, pages 45-60.
    • Handle: RePEc:sgh:annals:i:26:y:2012:p:45-60
    as

    Download full text from publisher

    File URL: http://rocznikikae.sgh.waw.pl/p/roczniki_kae_z26_03.pdf
    File Function: Full text
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. repec:zbw:bofitp:2001_013 is not listed on IDEAS
    2. Robert J. Barro & Xavier Sala-i-Martin, 2003. "Economic Growth, 2nd Edition," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262025531, April.
    3. Antonio Ciccone & Marek Jarociński, 2010. "Determinants of Economic Growth: Will Data Tell?," American Economic Journal: Macroeconomics, American Economic Association, vol. 2(4), pages 222-246, October.
    4. Robert J. Barro, 1991. "Economic Growth in a Cross Section of Countries," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 106(2), pages 407-443.
    5. N. Gregory Mankiw & David Romer & David N. Weil, 1992. "A Contribution to the Empirics of Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 107(2), pages 407-437.
    6. Blundell, Richard & Bond, Stephen, 1998. "Initial conditions and moment restrictions in dynamic panel data models," Journal of Econometrics, Elsevier, vol. 87(1), pages 115-143, August.
    7. Robert J. Barro & Rachel McCleary, 2003. "Religion and Economic Growth," NBER Working Papers 9682, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Michał Bernardelli, 2013. "Nieklasyczne modele Markowa w analizie cykli koniunktury gospodarczej w Polsce," Collegium of Economic Analysis Annals, Warsaw School of Economics, Collegium of Economic Analysis, issue 30, pages 59-74.
    2. Łukasz Goczek & Ewa Witkowska & Bartosz Witkowski, 2021. "How Does Education Quality Affect Economic Growth?," Sustainability, MDPI, vol. 13(11), pages 1-22, June.
    3. Forson, Joseph Ato & Opoku, Rosemary Afrakomah & Peng, Zhen, 2017. "Innovation, Institutions and Economic Growth in Sub-Sahara Africa – an IV Estimation of a Panel Threshold Model," MPRA Paper 103063, University Library of Munich, Germany, revised 15 Mar 2018.
    4. Goczek, Łukasz & Witkowski, Bartosz, 2023. "Spillover effects of the unconventional monetary policy of the European Central Bank," The Quarterly Review of Economics and Finance, Elsevier, vol. 89(C), pages 82-104.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Salimans, Tim, 2012. "Variable selection and functional form uncertainty in cross-country growth regressions," Journal of Econometrics, Elsevier, vol. 171(2), pages 267-280.
    2. Próchniak, Mariusz & Witkowski, Bartosz, 2013. "Time stability of the beta convergence among EU countries: Bayesian model averaging perspective," Economic Modelling, Elsevier, vol. 30(C), pages 322-333.
    3. I. Hakan Yetkiner, 2006. "Saglik ile Buyume," Ege Academic Review, Ege University Faculty of Economics and Administrative Sciences, vol. 6(2), pages 83-91.
    4. Bernard Njindan Iyke, 2018. "The real effect of currency misalignment on productivity growth: evidence from middle-income economies," Empirical Economics, Springer, vol. 55(4), pages 1637-1659, December.
    5. Eric Hanushek & Ludger Woessmann, 2012. "Do better schools lead to more growth? Cognitive skills, economic outcomes, and causation," Journal of Economic Growth, Springer, vol. 17(4), pages 267-321, December.
    6. Matos, Pedro Verga & Faustino, Horácio C., 2012. "Beta-convergence and sigma-convergence in corporate governance in Europe," Economic Modelling, Elsevier, vol. 29(6), pages 2198-2204.
    7. Lee, Jim, 2011. "Export specialization and economic growth around the world," Economic Systems, Elsevier, vol. 35(1), pages 45-63, March.
    8. Stimpfle, Alexander & Stadelmann, David, 2015. "The Impact of Fundamental Development Factors on Different Income Groups: International Evidence," VfS Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 113128, Verein für Socialpolitik / German Economic Association.
    9. Markus Eberhardt & Francis Teal, 2011. "Econometrics For Grumblers: A New Look At The Literature On Cross‐Country Growth Empirics," Journal of Economic Surveys, Wiley Blackwell, vol. 25(1), pages 109-155, February.
    10. Hauk, William R., 2017. "Endogeneity bias and growth regressions," Journal of Macroeconomics, Elsevier, vol. 51(C), pages 143-161.
    11. Ulaşan, Bülent, 2012. "Cross-country growth empirics and model uncertainty: An overview," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 6, pages 1-69.
    12. Paola Bongini & Małgorzata Iwanicz-Drozdowska & Paweł Smaga & Bartosz Witkowski, 2017. "Financial Development and Economic Growth: The Role of Foreign-Owned Banks in CESEE Countries," Sustainability, MDPI, vol. 9(3), pages 1-25, March.
    13. Deng, Wen-Shuenn & Lin, Yi-Chen & Gong, Jinguo, 2012. "A smooth coefficient quantile regression approach to the social capital–economic growth nexus," Economic Modelling, Elsevier, vol. 29(2), pages 185-197.
    14. Teixeira, Aurora A.C. & Queirós, Anabela S.S., 2016. "Economic growth, human capital and structural change: A dynamic panel data analysis," Research Policy, Elsevier, vol. 45(8), pages 1636-1648.
    15. Mr. Serhan Cevik & João Tovar Jalles, 2023. "Eye of the Storm: The Impact of Climate Shocks on Inflation and Growth," IMF Working Papers 2023/087, International Monetary Fund.
    16. Łukasz Goczek, 2012. "Metody ekonometryczne w modelach wzrostu gospodarczego," Gospodarka Narodowa. The Polish Journal of Economics, Warsaw School of Economics, issue 10, pages 49-71.
    17. Papaioannou, Elias, 2007. "Finance and growth: a macroeconomic assessment of the evidence from a European angle," Working Paper Series 787, European Central Bank.
    18. Kulhánek, Lumír, 2012. "Real convergence in Central and Eastern European EU member states," MPRA Paper 39822, University Library of Munich, Germany.
    19. Esa Mangeloja, 2004. "Interrelationship of economic growth and regional religious properties," ERSA conference papers ersa04p94, European Regional Science Association.
    20. Simplice A. Asongu & Joseph I. Uduji & Elda N. Okolo‐Obasi, 2020. "Drivers and Persistence of Death in Conflicts: Global Evidence," World Affairs, John Wiley & Sons, vol. 183(4), pages 389-429, December.

    More about this item

    Keywords

    convergence; economic growth; growth factors; bayesian averaging;
    All these keywords.

    JEL classification:

    • C11 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Bayesian Analysis: General
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sgh:annals:i:26:y:2012:p:45-60. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Michał Bernardelli (email available below). General contact details of provider: https://edirc.repec.org/data/sgwawpl.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.