TY  - JOUR
AU  - Cheung, Yin-Wong
AU  - Dooley, Michael P
AU  - Sushko, Vladyslav
TI  - Investment and Growth in Rich and Poor Countries
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 17788
PY  - 2012
Y2  - January 2012
DO  - 10.3386/w17788
UR  - http://www.nber.org/papers/w17788
L1  - http://www.nber.org/papers/w17788.pdf
N1  - Author contact info:
Yin-Wong Cheung
Department of Economics and Finance
City University of Hong Kong
Hong Kong
E-Mail: yicheung@cityu.edu.hk

Michael P. Dooley
Department of Economics
Engineering II
University of California, Santa Cruz
Santa Cruz, CA 95064
Tel: 831/459 3662
Fax: 831/459-5077
E-Mail: MPD@UCSC.EDU

Vlad Sushko
Bank for International Settlements
Centralbahnplatz 2
4002 Basel
Switzerland
E-Mail: vladyslav.sushko@bis.org
AB  - This paper revisits the association between investment and growth. The empirical findings highlight substantial heterogeneity for the effect of investment on growth and suggest a possible negative association. Results based on a battery of cross-sectional and time-series regressions show that the link between investment and growth has weakened over time and that investment in high-income countries is more likely to have a negative effect on growth. The adverse effect for high-income countries appears to have increased over time. An implication is that uphill capital flows could be associated with negative or zero returns. The result is robust to the presence of control variables that are commonly included in growth studies.
ER  -