Document Type

Article

Publication Date

2-2015

Publication Title

Empirical Economics

Volume

48

Abstract

In this paper, we uncover growth volatility regimes and identify their robust determinants using a large international panel of countries. In doing so, we propose a novel empirical methodology that allows us to simultaneously deal with two key elements of model uncertainty, namely theory uncertainty and parameter heterogeneity, by unifying two recent econometric techniques: Bayesian model averaging and threshold regression. We find ample evidence of parameter heterogeneity and model uncertainty. Our results highlight the role of ethnic fractionalization, institutions, financial development, health, and geography.

Issue

1

First Page

461

Last Page

491

DOI

10.1007/s00181-014-0868-9

ISSN

1435-8921

Rights

This is a post-peer-review, pre-copyedit version of an article published in Empirical Economics. The final authenticated version is available online at: http://dx.doi.org/10.1007/s00181-014-0868-9

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