Table 9: Dependent variable: growth rate of per capita GDP. Regressors: lagged growth rate of per capita GDP, volatility of GDP growth, consumption growth, investment growth, government consumption growth, and control variables. Sample: OECD countries (21 countries). Horizon: 1978–2007. Annual observations. All regressions include year dummies.

Dynamic models estimations—restricted sample
Estimation LSDV LSDV LSDV SYS-GMM SYS-GMM SYS-GMM
IV 2sls IV 2sls IV 2sls

GDP volatility −0.339** −0.089 −0.135 0.700
(−1.99) (−0.40) (−0.63) (1.54)
Consumption volatility −0.586***−0.560***−0.386** −0.562**
(−3.65) (−3.14) (−2.17) (−2.15)
Investment volatility −0.020 −0.001 −0.059 −0.222*
(−0.43) (−0.02) (−1.01) (−1.79)
Government consumption volatility 0.235** 0.242** 0.291* 0.289*
(2.04) (2.06) (1.79) (1.72)
GDP growth ( ) 0.478*** 0.430*** 0.428*** 0.473*** 0.432*** 0.451***
(7.30) (6.92) (6.89) (4.14) (3.58) (3.53)
Education 0.004 0.004 0.004 −0.004 −0.001 −0.001
(0.70) (0.72) (0.73) (−0.32) (−0.02) (−0.13)
Population growth 0.220 0.267 0.268 0.111 −0.112 −0.007
(0.50) (0.63) (0.63) (0.16) (−0.22) (−0.01)
Initial GDP −0.036** −0.032**−0.034**−0.012 −0.012 −0.012
(−2.23) (−2.23) (−2.24) (−0.56) (−0.74) (−0.62)
Investment share of GDP −0.072*** −0.063*** −0.062***−0.135**−0.094*−0.117***
(−3.72) (−3.40) (−3.40) (−2.47) (−1.69) (−2.66)
Observations 567 567 567 609 609 609
Country dummies Yes Yes Yes No No No
Instruments Yes Yes Yes Yes Yes Yes
Kleibergen-Paap Wald statistic 212.340 202.231 201.867
Hansen /Sargan test ( value) 0.713 0.571 0.562 0.182 0.215 0.214
Arellano-Bond test (AR2) ( value) 0.862 0.745 0.768

Note: -statistics in parenthesis, robust SEs. *Significance at 10%, **significance at 5%, and ***significance at 1%.