Saturday, January 26, 2008

Another paper on the Great Divergence

here.Rodrik's comment:
"Aside from an interesting historical discussion, Galor and Mountford provide some striking evidence on the contemporary relationship between trade, on the one hand, and fertility and education, on the other. Controlling for endogeneity and other possible problems, they show that larger trade shares are associated with lower fertility and greater investment in education in the OECD economies, but with higher fertility and lower education in developing economies.
I am more convinced by the historical discussion than by the contemporary evidence (for one thing, the skill premium has generally risen--not fallen--in most developing economies opening up to trade in recent decades). But I do find these scatter plots intriguing. "

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