Estimation of Disembodied Technical Change During the Kuznets Cycles of Romania’s First Transition to Market Economy

Romania’s first transition to market economy lasted more than six decades (from the establishment of the Romanian modern state in 1859 till the Land Reform adopted in 1921). This transformation of the economy can be viewed in the context of three Kuznets cycles, defined by the fluctuations of the gross domestic product, institutional changes and two major external shocks – the 1877–1878 War of Independence and the 1899 international economic and financial crisis. This paper identifies not only the Kuznets cycles but also the Kitchin and Juglar cycles of Romania’s economy, estimates the rate of disembodied technical change and reveals the economic growth trajectory during each of the three Kuznets cycles during the 1863–1914 period. It concludes that the feature of economic growth has changed from one cycle to another and that the sensible fluctuations of the rate of growth were mainly caused by the blockages maintained in the agricultural activities.