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• We test for Granger causality in mean and quantiles between wage share and capacity utilization in developed countries. • We employ confidence intervals generated by bootstrap and the Wald test for joint significance. • Capacity utilization positively Granger causes the wage share in eight countries at the center, lower and upper tails. • The positive Granger causal effect of capacity utilization is strong, heterogeneous, and larger for extreme quantiles. • The wage share negatively Granger causes capacity utilization in all quantiles in Spain and above the median in Italy. This paper tests for Granger causality in quantiles between the wage share and capacity utilization in twelve developed countries using annual data ranging from 1960 to 2019. Instead of focusing only on the conditional mean, we test for Granger causality in the entire conditional distribution of the variables of interest. This method detects Granger causal dynamic relations in both the mean and the whole conditional distribution using bootstrap confidence intervals and the Wald test. Our results indicate that capacity utilization positively affects the wage share in eight out of the twelve sample countries. This Granger causal effect is strong and heterogeneous across quantiles, being larger for more extreme quantiles. Capacity utilization positively Granger causes the wage share in all conditional quantiles in the U.S., Sweden, and Italy. Meanwhile, the wage share negatively Granger causes capacity utilization in all conditional quantiles in Spain and in some quantiles above the median in Italy. [ABSTRACT FROM AUTHOR]

This paper theoretically constructs a simple model to study the effect of the structure of employment on the external trade balance. The paper illustrates that when the share of employment in services increases, the external trade deficit also increases, and this occurs due to the direct effect of the income and the indirect effect of the productivity. Empirically, the paper analyzes the effects of the structure of employment upon the external balance of goods and services in the panel dataset of 137 developing and developed countries for the period from 1960 to 2011. The paper finds that the external trade deficit has been rising with a higher share of the employment in services. [ABSTRACT FROM AUTHOR]

• We analyze the impact of inward FDI on countries' economic complexity • We use a panel Granger causality and a panel VAR approach • Inward FDIs Granger cause economic complexity, and not viceversa • The short-run impact of FDI on economic complexity is very small • Knowledge-intensive greenfield FDI Granger cause economic complexity in developing countries In this paper, we assess whether attracting higher amounts of FDI induces a greater level of economic complexity in a country. Using a panel of 117 countries and 22 years, from 1995 to 2016, we test for the causal relationship between inward FDI and economic complexity using a panel VAR approach and Impulse Response Functions. We find that accumulating a higher stock of inward FDI per capita Granger-causes a greater economic complexity in a country, and not vice versa. This causal effect is very small, however, and occurs only in countries with above-average levels of GDP per capita, tertiary education, tertiarization or financial development. We also find that only greenfield FDIs Granger-cause economic complexity in developed countries. Finally, knowledge-intensive greenfield projects are the only type of FDI that Granger-cause complexity in a less developed country, but the estimated effect is near zero and disappears after two years. [ABSTRACT FROM AUTHOR]

• We analyse the long run relation between GDP per-capita growth and employment. • In the mid-1990s this relationship turned to be non-positive. • We found Jobless Growth and Decoupling between productivity and compensations. • Both can be explained by an inadequate aggregate demand growth. • Knowledge intensity of the economic sectors plays a key role. This paper is aimed at studying the long run relationship between GDP per capita growth and the job "required" by such a growth. This relationship, which has been positive for a long period after World War II, leading to a more equal and wealthy society via the labour market, turned out to be non-positive since the middle of the 1980s, giving rise to the so-called "Jobless Growth" and "Jobless Recovery" phenomena. By analysing data from STAN databases throughout the period 1970–2015, we found that the break in the relation between GDP per capita growth and employment can be explained by the decoupling between productivity from one hand, and labour compensation and utilisation from the other. Our findings further suggest that different economic sectors specifically contributed to the productivity change in accordance with their technological and knowledge intensity. [ABSTRACT FROM AUTHOR]

This paper examines the impact of labor regulation on total and youth employment of 108 countries over the timespan, 1996–2013. The methodology used is the dynamic panel data technique which distinguishes between short-run and long-run effects of legal change and takes into account dynamic interactions between legal and economic variables. It is observed that laws protecting the interests of labor do not hamper the long-term employment prospects of the general work force and the youth population. By and large this result holds in the two sub-samples: one consisting of 23 developed countries and the other consisting of 85 less-developed countries. [ABSTRACT FROM AUTHOR]

• Financial liberalization and years since last regulatory reforms increase banking crisis vulnerability. • Financial liberalization- banking instability (crisis) link depends largely on the regulatory framework updating. • Regulatory delays- banking instability (crisis) relationship depends on the level of financial liberalization. • The relationship between financial liberalization and banking system vulnerability can be illustrated by a U-Shaped relationship according the number of years since last regulatory reforms. Similarly, the link between years since the last reform and banking system situation can be estimated by a U-Shaped curve depending on the level of financial liberalization. This paper aims at bringing new insights concerning the effect of financial reforms on banking system vulnerability. We show that the link between financial liberalization and banking crisis depends on the number of years since last regulatory reforms. Similarly, we show that updating regulations indirectly affect banking crisis according to the financial liberalization level. Then, we show that banking crisis can be largely explained by a gap between financial innovations and regulation update on a sample of 49 developed and developing countries from 1980 to 2010. Our empirical evidence supports that the regulatory environment is more important in developed countries as it reduces banking fragility perhaps because of highly-risky exchanged financial products. The effect of financial liberalization depends largely on the number of years since last reform. However, destabilizing effect of financial liberalization in developing countries cannot be neutralized by updating regulations and gets more obvious as regulations become older. [ABSTRACT FROM AUTHOR]

• Historical correlation between US and the remaining G6 stock market returns analysed. • Correlations are explained with global crises measures. • Mixed frequency approach is used based on functional data analysis. • Some diversification benefits are observed during the early 20th century. • In the wake of crises, evidence of diversification benefits is non-existent post 1950. This paper presents a novel, mixed-frequency based regression approach, derived from functional data analysis (FDA), to analyze the effect of global crises on stock market correlations, using a long span of data, dating as far back as early 1800s, thus covering a wide range of global crises that have not yet been examined in the literature in this context. Focusing on the advanced nations in the G7 group, we observe heterogeneous effects of global crises on the convergence patterns across developed stock markets. While the post World War II period experienced a general rise in the level of correlations among developed stock market returns, we find that global crises in general have led to a stronger association of stock market returns in the US, UK and Canada, whereas the opposite holds when it comes to how European and Japanese stock markets co-move with the US. Overall, our results suggest that crises that are global in nature generally contribute to the convergence of global stock markets, while the effect largely depends on the context and nature of the crises that possibly drive the perception of risk and/or contagion in financial markets. From an investment perspective, our findings suggest that, in the wake of global crises, diversification benefits will be limited by moving funds across the US and UK stock markets whereas possible diversification benefits would have been possible during the crises-ridden period of the early twentieth century by holding positions in equities in the remaining G7 nations to supplement positions in the US. However, these diversification benefits seem to have frittered away in the post World War II period, highlighting the role of emerging markets and alternative assets to improve diversification benefits in the modern era. [ABSTRACT FROM AUTHOR]

• China's changing role in the global innovation network. • R&D embodied in international trade flow is also considered. • Industrial sectors have exhibited different characteristics during this transformation. • Innovation diffusion networks become more evenly distributed in terms of inward linkages while. • The networks become more hierarchic in terms of outward linkages. This paper aims to explore the changing role of China in the global innovation network and the evolution of product-embodied research and development (R&D) in this country. R&D embodied in international trade flow is also considered to ensure the comparability with studies of developed countries. The results show that China is transforming from a technology absorber to a neutral player who is also a major technology producer. Further analysis demonstrates that industrial sectors have exhibited different characteristics during this transformation. China's innovation diffusion networks become more evenly distributed in terms of inward linkages, while the networks become more hierarchic in terms of outward linkages. The latter trend is beneficial to technology diffusion. Particularly, three industries (I-13, I-12, and I-7) possessed the central position as the most important R&D sources. [ABSTRACT FROM AUTHOR]

Abstract: In this paper a theoretical framework for the analysis of knowledge suitable to study processes of knowledge generation and utilisation in advanced post-industrial societies is presented. This framework is based on two fundamental properties of knowledge, that of being a co-relational structure and that of being a retrieval/interpretative structure. The paper shows that a third property, the local character of knowledge, can be derived from the two fundamental ones. Furthermore, it is shown that the production of knowledge can be analysed by means of concepts currently used in economics, such as the division of labour, coordination, specialization, competition and so on. Finally, the paper shows that the framework proposed here is compatible with a number of epistemological concepts and theories and applicable to the empirical analysis of processes of knowledge generation and utilization in firms. [Copyright &y& Elsevier]

Abstract: This paper explores the possibility that unregulated FDI flows are causally implicated in the decline in labor productivity growth in semi-industrialized economies. These effects are hypothesized to operate through the negative impact of firm mobility on worker bargaining power and thus wages. Downward pressure on wages can reduce the pressure on firms to raise productivity in defense of profits, contributing to a low wage-low productivity trap. This paper presents empirical evidence, based on panel data fixed effects and GMM estimation for 37 semi-industrialized economies that supports the causal link between increased firm mobility and lower wages, as well as slower productivity growth over the period 1970–2000. [Copyright &y& Elsevier]

Research and development activities, as well as all other economic activities, do not occur in a spaceless economy, but are related to particular geographical areas. This paper investigates to what extent technological activities have a tendency to concentrate in centres of excellence or to diffuse across many countries. A framework for the identification of different technological trends is created. The main findings of this paper show the existence of four different technological trends, two of them connected to the characteristics of the national system of innovation of countries and the other two related to the particular features of technology. [Copyright &y& Elsevier]

Abstract: Prior to the mid-1970s, western industrialized nations’ GDP grew at an average annual rate in excess of 3%. Since, growth rates have been halved and productivity growth has plummeted, prompting renewed interest in growth theory. This paper examines the methodology of economic growth theory from Moses Abramovitz to Paul Romer, focusing specifically on the intellectual links between economics and engineering. It is argued that growth models in general have ignored the basic principles of classical mechanics, and, more importantly, that this omission has been costly. For example, it is shown that by including energy, the cornerstone of production processes as modelled in engineering, in simple growth accounting exercises, the Solow residual is nearly eliminated. [Copyright &y& Elsevier]

Abstract: There is now an extensive empirical literature relating to tests for various forms of convergence between the real per capita outputs of different countries. The evidence from these tests is mixed, and depends upon the type of data used, the countries in question, and the sample period in question. However, very little attention has been paid to the possibility of an associated convergence in “well-being” across countries. Indeed, it is interesting to posit the lack of any connection between convergence in output (income) and convergence in well-being. In this paper we address this issue in the context of 14 OECD economies, using various measures of well-being, and different tests of convergence. The latter include a time-series test recently proposed by Nahar and Inder [Nahar, S., Inder, B., 2002. Testing convergence in economic growth for OECD countries. Applied Economics 34, 2011–2022], and a test based on fuzzy clustering proposed by Giles [Giles, D.E.A., in press. Output convergence and international trade: time-series and fuzzy clustering evidence for New Zealand and her trading partners, 1950–1992. Journal of International Trade and Economic Development]. Our findings indicate that in general one should not expect convergence in output to be associated with convergence in well-being. [Copyright &y& Elsevier]