Catastrophes such as floods, droughts and earthquakes have caused significant human and infrastructural losses throughout history. Nevertheless, researchers struggle to quantify macroeconomic impacts, and the existing literature is ambiguous in its findings. In this study I use econometric methods on panel data from Centre for Research on the Epidemiology of Disasters (CRED), and find that hydrometeorological, climatological and geophysical events all affect economic growth negatively in the short run. Second, while events typically linked to climate change tend to cause negative growth shocks the same year they occur, geophysical disasters do not alter overall economic performance before the next year. With respect to future global warming, these dynamic differences give important insights for the understanding of how economies might be affected by climate change. However, by means of two stage least square methods, I do not find that negative economic shocks caused by weather related disasters increase the likelihood of armed civil conflicts. This latter result is in contrast to conclusions in much of the seminal conflict literature, but similar to findings in other recent cross-country studies that use the instrument variable approach.

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Developing countries are dependent upon foreign capital since they lack adequate domestic means to save and invest in order to grow and develop. This thesis aims to evaluate the role of foreign capital inflows in enhancing economic growth in a sample of 90 developing countries between the years 1991 and 2006. Even though FDI is recognized as the most attractive key in economic development strategies, numerous international help organizations call for increased ODA flows since many developing countries do not seem to benefit from FDI. This study will closely look into the issue where FDI and ODA are incorporated into the same model to identify the different effects they bring upon economic growth. Is capital given by the altruistic intention to assist developing nations in the form of ODA more beneficial than capital given through FDI by Multi-National Corporations (MNC) with their egoistic profit-seeking incentives, in the matter of enhancing economic growth? The obtained results from our cross-sectional OLS-regression are coherent with previous studies where FDI promotes economic growth, while ODA has a negative impact. This implies that FDI do actually play a more important role in developing countries than ODA in increasing growth in GDP per capita.

Demographic transition implies severe challenges for high income nations, for instance Japan, as the population decreases due to declines in birth rates as well as the higher rate of elderly population. More women are entering the labor market which affects birth rates. In addition, technological progress has improved health care and standard of living, bringing up life expectancies. However, the elderly population is increasing, elevating the dependency ratio which dampens the economic growth. The changed age structure alters the ratio of labor force negatively relative to population, in spite of the higher female labor participation. This paper analyzes how the current demographic transition in advanced countries influences economic growth. The paper is focused on Japan that is currently dealing with the consequences from the fastest increase in the percentage share of the elderly population compared to the other high income countries. The empirical analysis is based on a growth accounting model that estimates the impact of demographic factors on growth rates in high income countries. The empirical results indicate that demographic factors such as life expectancy and total dependency ratio have a negative impact on economic growth. The conclusion is that Japan and other rich countries have to make greater efforts in dampening the demographic change by policy making and in-migration.

This paper analyzes empirically the effect of crude oil price change on the economic growth of Indian-Subcontinent (India, Pakistan and Bangladesh). We use a multivariate Vector Autoregressive analysis followed by Wald Granger causality test and Impulse Response Function (IRF). Wald Granger causality test results show that only India’s economic growth is significantly affected when crude oil price decreases. Impact of crude oil price increase is insignificantly negative for all three countries during first year. In second year, impact is negative but smaller than first year for India, negative but larger for Bangladesh and positive for Pakistan.

This paper aims to explore the relationship between Foreign Direct Investments and the standard of living in terms of the Human Development Index in the region of Sub-Saharan Africa. The theory of economic growth is based on Solow. For the region of Sub-Saharan Africa, Foreign Direct Investments ought to be of great importance to finance the investments needed to achieve economic growth according to Solow. The reason for this is that the region of Sub-Saharan Africa lacks the ability to finance these investments with its own savings. The focus of the report is the Foreign Direct Investments; although the variable shows no significant correlation to the Human Development Index, there is a significant positive correlation between Foreign Direct Investments and health expenditure as a percentage of total government expenditure, one of the driving forces behind an improved Human Development Index.

One of the most important objectives for any countries is to sustain high economic growth. Even though there are main factors that affect economic growth, the concern of this paper is only about inflation. The relationship between economic growth and inflation is debatable. The first objective of this study is to investigate the relationship between inflation and economic growth. This study uses panel data which includes 13 SSA countries from 1969 to 2009. To analyze the data the model is formed by taking economic growth as dependent variable and four variables (i.e. inflation, investment, population and initial GDP) as independent variables. The result indicates that there is a negative relationship between economic growth and inflation. This study is also examined the causality relationship between economic growth and inflation by using panel Granger causality test. Panel granger causality test shows that inflation can be used in order to predict growth for all countries in the sample, while the opposite it is only true for Congo, Dep. Rep and Zimbabwe.

We analyze sector specific shocks in productivity and demand in 19 manufacturing sectors of the Austrian economy. Based on a structural vector autoregressive (SVAR) model with long run restrictions developed by Gali (1999) we extract technology and non-technology shocks from sectoral and aggregate data and study their patterns and relationship by means of a principal components analysis. We find a close association of sectoral and macroeconomic non-technology shocks but only a very weak association for technology shocks. Impulse-response analysis indicates that for almost all manufacturing sectors and the Austrian economy productivity growth rates experience an immediate increase to positive technology shocks while the hours worked decline. We therefore confirm Gali's results on the level of manufacturing industries. Finally, we use the identified shocks as explanatory variables in fixed effect regressions on growth rates of employment, output and investment. We find that our shocks are closely associated to employment growth and output growth but not to growth in investment. The effect of technology shocks is different on the level of manufacturing industries and the aggregate economy. (author's abstract) / Series: Working Papers Series "Growth and Employment in Europe: Sustainability and Competitiveness"

Knowledge creation processes and the innovation systems through which it is transferred for the benefit of society are the economic driver of industrial economies in the globalized era, yet developing countries seeking to move through the transition from developing to developed status are struggling . A variety of theories and a range of speculations have been offered as to why some nations are more innovative than others, however little of this literature examines the theoretical and practical applicability of innovation models based on industrial societies for developing nations. This thesis examines a selection of theoretical innovation system models, analyzes their roots and assesses their applicability to transition economies where various pieces of the system present structural differences relative to developed nations. This thesis uses Mexico as a case study.<p> In the fifteen years since the 1994-95 collapse of Mexicos financial sector and the resulting economic crisis, the Mexican economy has made impressive progress towards macro-economic consolidation and stability. The OECD (2004) observes that the inflation rate has fallen from around 50% during the economic collapse of 1995 to about 4% in 2006. GDP growth has averaged 3.2% in the period from 1994 to 2008 (compared to the OECD average of 2.7%). As a partner in the North American Free Trade Agreement, trade liberalization has allowed Mexico to consolidate its export base and to specialize in medium- and high-technology manufacturing. However, the industrial sector in Mexico still shows a slow pace in developing, adopting and investing in technology. The Mexican industrial sector is lead by multinational firms that have located in Mexico due to the cheap costs of labour, while most of the research and development performed by these firms takes place outside of Mexico. Mexicos policy for S&T seems to show a disconnect between the discourse and practice.<p> Indicators show that Mexico considerably lags in S&T development. S&T development has not contributed to facilitating the country's positioning as one of the top ten most competitive nations in the world. Rather, technology transfer outcomes in the country, relative to other transitional economies, manifest an increasing deceleration in Mexico's S&T competitiveness. This thesis contrasts the innovation system in which technology transfer processes navigate in Mexico to the leading literature on theoretical models of innovation. This process facilitates identifying crucial barriers and challenges of the Mexican system of innovation that need to be addressed in order to achieve a level of S&T development that would contribute to facilitating Mexico's transition to a developed economy.

The rate of economic growth varies extensively between different countries. The underlying reasons to the differences are dissimilarities in productivity and efficiency, which in turn seem to be affected by factors such as the institutional setup, the rate of economic freedom, the level of human and social capital, corruption and interpersonal trust.This thesis investigates the relationship between economic growth and the level of democracy in developing countries, as a well-functioning democracy to a large extent corresponds to an inclusive institutional setup. The empirical investigation is conducted with a regression analysis. Using secondary data from acknowledged organizations and institutes, possible factors that may affect average GDP per capita growth are examined. The estimations included in the regression are democracy, foreign direct investment, education expectancy, initial GDP per capita, population growth rate, life expectancy, corruption, Rule of Law and Internet users. The empirical result shows that democracy has no significant effect on growth, but suggests that the effect might be indirect since factors such as good maintenance of Rule of Law, low level of corruption, high interpersonal trust, a high level of economic freedom and enhanced property rights are empirically proven to correspond to well functioning institutions. This result is in accordance with previous research and seems to support the idea that a good institutional setup is important for economic growth.