2004
DOI: 10.1257/0002828042002570
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Determinants of Long-Term Growth: A Bayesian Averaging of Classical Estimates (BACE) Approach

Abstract: This paper examines the robustness of explanatory variables in cross-country economic growth regressions. It introduces and employs a novel approach, Bayesian Averaging of Classical Estimates (BACE), which constructs estimates by averaging OLS coefficients across models. The weights given to individual regressions have a Bayesian justification similar to the Schwarz model selection criterion. Of 67 explanatory variables we find 18 to be significantly and robustly partially correlated with long-term growth and … Show more

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Cited by 1,608 publications
(1,141 citation statements)
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“…We perform this joint treatment by extending the linear growth regression model to explicitly allow for multiple-regime parameter heterogeneity as suggested by new growth theory, while simultaneously addressing the variable selection problem by performing a Bayesian model averaging. Estimating the new models on the data set of Sala-i-Martin et al (2004) provides evidence of multiple-regime parameter heterogeneity of the type predicted by new growth theory and empirically documented by Durlauf and Johnson (1995) and Liu and Stengos (1999). In addition, we find that many of the explanatory variables indicated by the literature do not have robust marginal effects across countries when allowing for a more flexible model specification, contradicting the results of Minier (2007).…”
Section: Introductionmentioning
confidence: 57%
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“…We perform this joint treatment by extending the linear growth regression model to explicitly allow for multiple-regime parameter heterogeneity as suggested by new growth theory, while simultaneously addressing the variable selection problem by performing a Bayesian model averaging. Estimating the new models on the data set of Sala-i-Martin et al (2004) provides evidence of multiple-regime parameter heterogeneity of the type predicted by new growth theory and empirically documented by Durlauf and Johnson (1995) and Liu and Stengos (1999). In addition, we find that many of the explanatory variables indicated by the literature do not have robust marginal effects across countries when allowing for a more flexible model specification, contradicting the results of Minier (2007).…”
Section: Introductionmentioning
confidence: 57%
“…Following the tradition of the growth literature, as exemplified by Barro (1991), Levine and Renelt (1992), Sala-i-Martin et al (2004) and many others, we will consider linear regression models of the form…”
Section: Statistical Methodologymentioning
confidence: 99%
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