Losers and Winners in Economic Growth

Robert J. Barro, Jong-Wha Lee

NBER Working Paper No. 4341
Issued in April 1993
NBER Program(s):   EFG

For 116 countries from 1965 to 1985, the lowest quintile had an average growth rate of real per capita GDP of -1.3%, whereas the highest quintile had an average of 4.8%. We isolate five influences that discriminate reasonably well between the slow and fast-growers: a conditional convergence effect, whereby a country grows faster if it begins with lower real per capita GDP relative to its initial level of human capital in the fOnTIS of educational attainment and health; a positive effect on growth from a high ratio of investment to GDP (although this effect is weaker than that reported in some previous studies); a negative effect from overly large government; a negative effect from government-induced distortions of markets; and a negative effect from political instability. Overall, the fitted growth rates for 85 countries for 1965-85 had a correlation of 0.8 with the actual values. We also find that female educational attainment has a pronounced negative effect on fertility, whereas female and male attainment are each positively related to life expectancy and negatively related to infant mortality. Male attainment plays a positive role in primary-school enrollment ratios, and male and female attainment relate positively to enrollment at the secondary and higher levels.

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Published: Bruno, Michael and Boris Pleskovic (eds.) Proceedings of the World Bank Annual Conference on Development Economics, 1993: Supplement to The World Bank Economic Review and The World Bank Research Observer. Washington, D.C.: World Bank, 1994. pp. 267-314

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