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We Just Averaged over Two Trillion Cross-Country Growth Regressions
Author:
Mr. Mark F. J. Steel null

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Mr. Eduardo Ley
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Series:
IMF Working Papers
Volume/Issue:
Volume 1999: Issue 101
Language:
English
Publication Date:
01 Jul 1999
DOI:
https://doi.org/10.5089/9781451852493.001
ISBN:
9781451852493
ISSN:
1018-5941
Pages:
20
Keywords:
WP; regression coefficient
Legal-disclaimer:
IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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We investigate the issue of model uncertainty in cross-country growth regressions using Bayesian model averaging (BMA). We find that the posterior probability is distributed among many models, suggesting the superiority of BMA over any single model. Out-of-sample predictive results support that claim. In contrast with Levine and Renelt (1992), our results broadly support the more “optimistic” conclusion of Sala-i-Martin (1997b), namely, that some variables are important regressors for explaining cross-country growth patterns. However, the variables we identify as most useful for growth regression differ substantially from Sala-i-Martin’s results.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund