In an insightful and influential paper, Mankiw, Romer and Weil (1992) have suggested that an augmented Solow growth model can account for 80% of the variation in output per capita across countries due to different steady-state growth paths that result from differences in saving rates, education, and polulation groeth. This paper carries their analysis one step further and ask whether changes in the growth rate between the 1960s and 1980s can also be explained by this framework. Our resylts provide further support for several of Mankiw, Romer, and Weil's key conclusions- incestment in physical capital, polulation growth rates over time. We conclude that investment in physical capital seems to be quite important for economic growth, though the reasons for this improtance may not be fully captured by the augmented Solow growth model. |