Manufactured in the United States of Arnerica First printing 2001 Papers in this series are not formal publications of the World Bank. The findings, interpretations, and conclusions expressed in this paper are entirely those of the author(s) and should not be attributed in any manner to the World

evidence to support these claims. World Bank Policy Research Working Paper 2910, October 2002 The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly

Abstract: We document five stylized facts of economic growth. (1) The "residual" rather than factor accumulation accounts for most of the income and growth differences across nations. (2) Income diverges over the long run. (3) Factor accumulation is persistent while growth is not persistent and the growth path of countries exhibits remarkable variation across countries. (4) Economic activity is highly concentrated, with all factors of production flowing to the richest areas. (5) National policies closely associated with long-run economic growth rates. We argue that these facts do not support models with diminishing returns, constant returns to scale, some fixed factor of production, and that highlight the role of factor accumulation. Empirical work, however, does not yet decisively distinguish among the different theoretical conceptions of "total factor productivity growth." Economists should devote more effort towards modeling and quantifying total factor productivity.

entirely those of the authors and do not necessarily reflect the views of the World Bank, its Executive Directors, or the countries they represent.

The opinions expressed in this report do not necessarily represent the views of the World Bank or its member governments. The World Bank does not guarantee the accuracy of the data included in this publication and accepts no responsibility whatsoever for any consequence of their use. The boundaries

The opinions expressed in this report do not necessarily represent the views of the World Bank or its member governments. The World Bank does not guarantee the accuracy of the data included in this publication and accepts no responsibility whatsoever for any consequence of their use. The boundaries

*Thanks to participants at seminars at the World Bank and CERDI. This paper has benefited from support from DFID. ha ls hs

the author’s sole responsibility and do not necessarily reflect those of the World Bank Group, and their

The findings, interpretations, and conclusions expressed in this paper are entirely those of the author. They do not necessarily represent the views of the World Development Report 2011 team, the World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank

and Infrastructure, Latin America and the Caribbean, World Bank. The findings, interpretations and conclusions expressed in this paper are entirely those of the authors and should not be attributes in any manner to the World Bank, its affiliated organizations, members of its Board of Executive