The Anatomy of Growth in the OECD since 1870: the Transformation from the Post-Malthusian Growth Regime to the Modern Growth Epoch

This paper extends conventional growth accounting exercises to allow for endogeneity of capital, the demographic transition, age dependency, and employment rates among other factors. Using data for the OECD countries in the period 1870-2006 it is shown that growth has been predominantly driven by demographics and TFP growth. TFP has in turn been driven by R&D, knowledge spillovers through the channel of imports, educational attainment, and the interaction between educational attainment and the distance to the frontier. The estimates suggest permanent growth effects of R&D and human capital and, therefore, that growth can be expected to be positive for the rest of this century.