Economic Development and Growth

Economic Development & Growth

What makes countries’ economies grow towards a developed status is a subject of much debate, with competing approaches vying to assert their superiority. Free markets or state-led? National champions or free enterprise? Diversification or competitive advantage? This EconPol topic area cuts through dogmas and philosophies to find which factors actually drive economic growth, under what circumstances, and which ones make it sustainable.  It looks at strategies, policies, and initiatives aimed at enhancing productivity, promoting innovation, and creating favorable conditions for economic progress, and examines the role of various drivers of economic development, such as investment, entrepreneurship, technological advances, human capital development, and institutional frameworks. It also explores the challenges and opportunities associated with economic growth, including income inequality, environmental sustainability, and the distribution of resources.

Related articles

A New Understanding of Health Policy

A New Understanding of Health Policy Is Needed

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Expert Opinion
The current debate on health policy concerns important issues relating to the future provision and financing of our healthcare system. However, it is primarily taking place with the traditional focus on the treatment of illnesses. A broader understanding of healthcare policy is urgently needed for the future. This should increasingly combine prevention and the strengthening of resilience and potential for development as complementary approaches in a holistic health policy approach. This must explicitly include changing challenges against the backdrop of an increasing overuse of our natural resources.
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Forum Icon BIG-DATA-BASED ECONOMIC INSIGHTS

New Evidence on the Effects of EU Regional Policy

BIG-DATA-BASED ECONOMIC INSIGHTS

Julia Bachtrögler-Unger, Mathias Dolls, Carla Krolage, Paul Schüle, Hannes Taubenböck and Matthias Weigand

EU Cohesion Policy constitutes an important item in the EU budget. For the Multiannual Financial Framework 2021–2027, EUR 392 billion is reserved for the promotion of economic and social cohesion among the regions of the European Union. This article presents results from a pilot study that combines official data on projects co-funded by the ERDF and the CF in the programming period 2007–2013, with remote sensing data on night light emission and land cover to assess the effect of EU funding on economic growth at the municipal level, where regional GDP data are not available. Our approach can also be applied in other contexts, for example to study the impact of investment projects funded by Next Generation EU.

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Cover of EconPol Forum 6/2023: Green Transition

Green Transition: How to Make It Finally Happen?

Niko Jaakkola and Riccardo Rovelli, Lorenzo Forni and Massimo Tavoni, Karen Pittel, Alessio Terzi and Roger Fouquet, Luisa Carpinelli and Daniele Franco, Simone Borghesi and Albert Ferrari, Niko Jaakkola, Frederick van der Ploeg and Anthony Venables, Gianmarco Ottaviano

The devastating effects of climate change are becoming increasingly evident. It is difficult to accurately predict or even quantify the risks. Despite this threat, the pace of change is slow. Why is the world failing to tackle this problem collectively and effectively? What constraints are holding us back? How can we overcome them and contribute to the formulation of a credible and acceptable climate policy? What policy instruments can help pave the way to the green transition?

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Forum Icon BIG-DATA-BASED ECONOMIC INSIGHTS

It’s in the Data – Improved Market Power Mitigation in Electricity Markets

BIG-DATA-BASED ECONOMIC INSIGHTS

Jacqueline Adelowo, Moritz Bohland

In electricity markets, market power is typically measured by the difference between observed offers and underlying marginal (variable) cost of power production. Therefore, marginal cost estimates should be as accurate as possible to ensure unbiased measurement of market power and welfare-improving mitigation thereof. However, cost components and power plant characteristics are private information and firms have an incentive to overstate costs. Instead, system operators thus proxy marginal cost of power plants from past offers of the respective plant, which leaves room for strategic manipulation by firms. This article tests the accuracy of this best-practice benchmark approach against multiple suggested alternative methods. The results of our empirical analysis reveal a low estimation accuracy of the currently applied benchmark approach. All suggested alternative approaches deliver more precise estimates.

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Economic Growth and Ecological Sustainability

Can Economic Growth and Ecological Sustainability Coexist?

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Expert Opinion
Is long-term economic growth compatible with ecologically sustainable development? This question stands as one of the most debated issues of our time. Over the past decades, growth driven by economic liberalization and globalization has brought prosperity to billions and reduced global poverty. However, this positive trajectory has come at a high cost to the environment and the depletion of natural resources. The limitations of economic growth at the expense of the environment are evident. Sustainable economic prosperity can only be achieved in the long run if it is coupled with ecological sustainability.
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