Reexamining the role of land in economic growth

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Title: Reexamining the role of land in economic growth
Authors: Guillo, Maria Dolores | Pérez Sebastián, Fidel
Research Group/s: Grupo de Estudios de Paz y Desarrollo (GEPYD) | Análisis Económico
Center, Department or Service: Universidad de Alicante. Departamento de Métodos Cuantitativos y Teoría Económica | Universidad de Alicante. Departamento de Fundamentos del Análisis Económico
Keywords: Land | Two-sector growth model | Small-open economy
Knowledge Area: Fundamentos del Análisis Económico
Date Created: Feb-2010
Issue Date: 30-Jul-2012
Abstract: This paper reconciles the traditional view that land increases the wealth of nations with recent empirical findings that point out that natural inputs such as land are negatively related to growth. Our theory shows, whithin a two-sector neoclassical growth model with international trade in goods, that land directly affects both long-run income and transitional growth. These two effects can be positive or negative depending on input elasticities. Furthermore, they go in opposite directions, creating a tension that complicates the interpretation of estimated-coefficient signs in growth regressions. Quantitative results show that the two effects can be significant. We also produce empirical evidence that suggests a negative effect of land per worker on growth, but a positive impact on long-run income.
Sponsor: This research was partially supported by the Spanish Ministry of Science and Technology, SEJ 2007-62656, FEDER funds, and by the Instituto Valenciano de Investigaciones Económicas.
URI: http://hdl.handle.net/10045/23700
Language: eng
Type: info:eu-repo/semantics/workingPaper
Peer Review: no
Appears in Collections:INV - GEPYD - Working Papers
INV - Análisis Económico - Working Papers
INV - DMCTE - Working Papers

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