Comparative Analysis of Secular Stagnation by Countries: Growth Accounting and Multi-variable Regression

The phenomena of slow economic recovery and slow economic growth in richer countries have been prevalent compared to that performance in the rest of the world, referred to as secular stagnation, a concept that can be traced back to Alvin Hansen's work in 1939 by Lawrence Summers in 2013. To capture the slow-down, this work analyses the time series of growth of 142 countries selected from Penn World Table 10.0. To explain the phenomena and capture variables related to slow-down, this work uses Solow growth accounting at first and then the multiple linear regression derived from this approach. The results showed the decreasing returns to the high-income and middle-income group in comparison with the increasing returns in the low-income group for the potential explanation of secular stagnation; this work also found the significant variables influencing economic growth such as real output per capita and human capital.