We rely on microeconomics theory to compute the natural rate of interest for the G7 countries from 2001 to 2017. The equilibrium natural rate of interest is determined by a parsimonious equation that is easily computed from readily observable data, hence no estimation errors. The model predicts...

We estimate the effect of four types of education qualifications, as a proxy for human capital and skill levels, on GDP per capita, and compute the average percentage returns. We also test the effect of the product of each proxy of human capital with R&D on GDP per capita. We find that only...

We estimate the effect of four types of education qualifications, as a proxy for human capital and skill levels, on GDP per capita, and compute the average percentage returns. We also test the effect of the product of each proxy of human capital with R&D on GDP per capita. We find that only...

Qualification and occupation-based measures of skilled labour are constructed to explain the skill premium – the wage of skilled labour relative to unskilled labour in New Zealand. The data exhibit a more rapid growth in the supply of skilled labour than the skill premium, and a very large...

Qualification and occupation-based measures of skilled labour are constructed to explain the skill premium – the wage of skilled labour relative to unskilled labour in New Zealand. The data exhibit a more rapid growth in the supply of skilled labour than the skill premium, and a very large...

We use panel data for nine industries to evaluate research and development (R&D) investments in New Zealand over the past forty years. We estimate the impact of R&D stocks in a particular industry on output per person in that industry and on output per person in the rest of the economy. We...

Modern economic theories explain differences in productivity and economic growth across countries by differences in political and economic institutions, and differences in culture, geographical location, policies, and laws. The success of any of these theories in explaining the gap in...

The Gulf Cooperation Council countries (GCC) include Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE. Their monetary policy objective is to stabilize the foreign price, i.e., exchange rate instead of the domestic price level, where the nominal interest rate is equalized with the US...

I discuss econometric issues of high relevance to economists in central banks whose job is to interpret the permanency of shocks and provide policy advice to policymakers. Trend, unit root, and persistence are difficult to interpret. There are numerous econometric tests, which vary in their...

We examine the economic performance of Oman’s economy over the period from 1998 to 2016, where data are readily available. Our focus is on the performance of the non-hydrocarbon sector (NHC sector) relative to the hydrocarbon sector (HC sector), nominal versus real GDP growth, productivity...