Jakob Madsen (Monasth)

 Back to the Past: Is Growth Reverting to Pre-Industrial Levels?

Abstract. In his influential book, The Rise and Fall of American Growth, Gordon (2016) forwards the thesis that the US and, presumably, the rest of the West is entering a low growth regime and that the high growth experienced over the last one and a half centuries has been a one-time-only event. However, the growth predictions for the 21^st century have been complicated by our incomplete knowledge of the factors that have driven growth since 1800 and, therefore, which growth drivers have played out their roles. This paper constructs an extensive macroeconomic panel data set for 21 OECD countries spanning 216 years and estimates the approximate determinants of growth since 1800. The regression results are used to calibrate the approximate determinants of growth since 1800 and a likely growth scenario for the 21^st century.