In the Solow model we had before: the production technology is held constant (Assumption 4: A t = A) income per capita is constant in the steady state

Save this PDF as:

Size: px
Start display at page:

Download "In the Solow model we had before: the production technology is held constant (Assumption 4: A t = A) income per capita is constant in the steady state"

Transcription

1 In the Solow model we had before: the production technology is held constant (Assumption 4: A t = A) income per capita is constant in the steady state Neither point is true in the real world: : U.S. real GDP per person grew by a factor of 7.6, or 2% per year. examples of technological progress abound: From 1950 to 2000, U.S. farm sector productivity nearly tripled The real price of computer power has fallen an average of 30% per year over the past three decades 2001: ipod capacity = 5gb, 1000 songs 2008: ipod capacity = 160gb, 40,000 songs

2 The Solow Model with Technological Progress It may seem logical to let A t grow. Instead, we will introduce a new variable: labor efficiency E t Y t = AK α t (E t N t ) 1 α Technological progress is labor-augmenting: it increases labor efficiency at the exogenous rate g: E t E t = g > 0

3 The Solow Model with Technological Progress Y t = AK α t (E t N t ) 1 α E t N t is now the number of effective workers. Increases in labor efficiency have the same effect on output as increases in the labor force. E t N t E t N t E t E t + N t N t = g + n Efficiency units of labor grow at a rate g + n.

4 Definitions c t = C t /E t N t, i t = I t /E t N t, k t = K t /E t N t, y t = Y t /E t N t now denote per effective worker variables Y t = AK α t (E t N t ) 1 α Y t = AK t α (E t N t ) 1 α E t N t E t N t y t = Akt α f (k t ) y t = f (k t ) is the per effective worker production function k t is the capital-effective labor ratio.

5 The Capital Accumulation Equation The evolution of k t is now given by K t+1 = I t + (1 δ)k t K t+1 E t N t = I t + (1 δ) K t E t N t E t N t I t + (1 δ) K t E t N t E t N t E t+1n t+1 K t+1 E t N t E t+1 N t+1 = (1 + n + g)k t+1 = i t + (1 δ)k t N t+1 N t E t+1 E t E t+1n t+1 E tn t = 1 + n where n is the population growth rate = 1 + g where g is the labor efficiency growth rate = (1 + g)(1 + n) 1 + g + n where g is the labor efficiency growth rate

6 The Solow Model with Technological Progress We have in per effective worker terms: y t = f (k t ) (Production) c t + i t = y t (Goods Market Equilibrium) (1 + g + n)k t+1 = i t + (1 δ)k t (Capital Accumulation) c t = (1 s)y t (Consumption Function) which reduces to With a steady state sf (k t ) = (1 + g + n)k t+1 (1 δ)k t sf (k ) = (g + n + δ)k

7

8 Steady State Growth Rates Variable Steady State Growth Rate Capital per effective worker k = K EN 0 Output per effective worker y = Y EN 0 Capital-Labor Ratio Labor Productivity K N Y N g g Output Y g + n Consumption C g + n

9 Balanced Growth The steady state in the Solow model with technological progress exhibits balanced growth: many variables grow at the same rate. Predictions: 1. Y /N and K/N grow at the same rate g, so K/Y should be constant. This is true in the real world. 2. The real wage W /P grows at same rate as Y /N, while real rental price R/P is constant. αak α 1 (EN) 1 α = R P (1 α)ak α (EN) α E = W P This is also true in the real world.

10 The Golden Rule The golden rule steady state has the highest possible consumption per person: c = f (k ) (g + n + δ)k The golden rule kgold and c gold that maximizes this expression is: f k (k ) = (g + n + δ) where f k is the first derivative of f.

11 Convergence sf (k ) = (g + n + δ)k If countries have the same f (k), g, n, s then they have the same steady state. Prediction: Poor countries where k < k should grow faster then rich countries where k k. Convergence: The income gap between rich & poor countries should shrink over time, causing living standards to converge. In real world, many poor countries do NOT grow faster than rich ones.

12 annual growth rate CHN ROM THA HKG KOR JPN MYS MUS SYC BRB PRT IDN ESP LUX COG PAK CPV GRC IND AUT SYR ITA TURGAB FIN DOM ISR BEL LSO EGY BRA FRA MAR NOR LKA MWI NPL PAN BGD IRN CHL ISL TTO GBRDNK USA GNB SWE NLD AUS ZWE CAN ECU GTMJOR MEX UGA TZA BFA GMB CIV PHL ZAF CHE KEN ETH GHA PRY URY COL ARG BEN GIN SLVCRI NZL BDI TGO RWA CMR HND JAM BOL PER SEN COM MDG MOZTCD ZMB MLI NER VEN NGA NIC log gdp per worker 1960 IRL Figure Annual growth rate of GDP per worker between 1960 and 2000 versus log GDP per worker in 1960 for the entire world.

13 Conditional Convergence Convergence depends on f (k), g, n, s being equal across countries, which is not the case. Conditional Convergence: Countries converge to their own steady states, which are determined by s, n, and education (g) Income differences after US Civil War disappeared slowly over time. In samples of countries with similar s and n, income gaps shrink about 2% per year. In larger samples, after controlling for differences in s, n and human capital (g), incomes converge by about 2% per year.

14 annual growth rate JPN PRT GRC ESP IRL AUT ITA FIN FRA BEL NOR ISL GBR LUX DNK NLD SWE AUS CAN USA CHE NZL log gdp per worker 1960 Figure Annual growth rate of GDP per worker between 1960 and 2000 versus log GDP per worker in 1960 for core OECD countries.

15 Introduction to Modern Economic Growth Density of coutries gdp per capita Figure 1.1. Estimates of the distribution of countries according to PPPadjusted GDP per capita in 1960, 1980 and Figure 1.2 shows a similar pattern, but now the spreading-out is more limited. This reflects the fact that while the absolute gap between rich and poor countries has increased considerably between 1960 and 2000, the proportional gap has increased much less. Nevertheless, it can be seen that the 2000 density for log GDP per capita is still more spread out GDP/capita reflects the absolute gap between rich and poor countries

16 Introduction to Modern Economic Growth Density of coutries log gdp per capita Figure 1.2. Estimates of the distribution of countries according to log GDP per capita (PPP-adjusted) in 1960, 1980 and China and India were among the poorest nations in the world, whereas their relatively rapid growth in the 1990s puts them into the middle-poor category by Chinese and Indian growth has therefore created a powerful force towards relative equalization of income log(gdp/capita) reflects the proportional gap between rich and poor countries

17 The Income Distribution across Countries 1. There is a large amount of inequality in income per capita 2. The absolute gap between rich and poor countries has increased considerably between 1960 and The proportional gap has increased noticeably but much less 4. Stratification phenomenon: considerable increase in the density of relatively rich countries, while many countries still remain quite poor 5. Twin Peaks phenomenon

18 What Policies to Promote Growth? Is free trade good for economic growth? Should policy change the saving rate and if yes, how? How should we allocate investment between privately owned physical capital, public infrastructure, and human capital? How do a country s institutions affect production efficiency and capital accumulation? What policies might encourage faster technological progress?

19 Free Trade and Growth Since Adam Smith, economists have argued that free trade can increase production efficiency and living standards Average Annual Growth Rates : open closed developed nations 2.3% 0.7% developing nations 4.5% 0.7% But correlation does not prove causation Examples of economic growth after opening up (Japan 1850s, South Korea 1960s, Vietnam 1990s,...)

20 Free Trade and Growth To determine causation, exploit geographic differences among countries: Some nations trade less because they are farther from other nations, or landlocked. Such geographical differences are correlated with trade but not with other determinants of income. Hence, they can be used to isolate the impact of trade on income. Findings: increasing trade/gdp by 2% causes GDP per capita to rise 1%, other things equal. Together with many other studies, there is very strong evidence for the effect of openness on growth.

21 Figure 5.3. Share of Developing Countries in Trade As China, India, and the Eastern bloc have opened up, world markets and opportunities to export have expanded considerably for advanced economies and developing countries alike Exports of Developing Countries (percent of advanced economies' exports) Non-oil goods Imports of Developing Countries (percent of advanced economies' imports) Services Non-oil goods Services Manufacturing Imports of Advanced OECD Economies by Source 10

22 Should Policy Change the Saving Rate? We can use the Golden Rule to determine whether the U.S. saving rate and capital stock are too high, too low, or about right: Because of diminishing returns f k = MP K is decreasing in k If f k (k ) δ > g + n, U.S. is below the Golden Rule steady state and should increase s. If f k (k ) δ < g + n, U.S. is above the Golden Rule steady state and should decrease s.

23 Should Policy Change the Saving Rate? To estimate MPK δ, use three facts about the U.S. economy: 1. K = 2.5Y : The capital stock is about 2.5 times one year s GDP. 2. δk = 0.1Y : About 10% of GDP is used to replace depreciating capital. 3. MP K K = 0.3Y : Capital income is about 30% of GDP (see before). Using 1 and 2, δ = δk K = 0.1Y 2.5Y = 0.04 Using 3 and 1, MP K = MP K K K = 0.3Y 2.5Y = 0.12 Therefore, f k (k ) δ = MP K δ = 0.08

24 Should Policy Change the Saving Rate? We have f k (k ) δ = 0.08 U.S. real GDP grows an average of 3% per year, so g + n = Therefore f k (k ) δ > g + n The U.S. is below the Golden Rule steady state: Increasing the U.S. saving rate would increase consumption per capita in the long run. Similar results hold for most other countries.

25 Savings (green) and Investment (red) to GDP ratio

26 saving has been exclusively in emerging market and oil-producing countries, which are building up high current account surpluses. Saving Investment Current account (left scale) All Countries Industrial Countries 24

27 How to Increase the US Saving Rate? 1. Reduce the government budget deficit (or increase the budget surplus). 2. Increase incentives for private saving: Reduce capital gains tax, corporate income tax, estate tax as they discourage saving. Replace federal income tax with a consumption tax. Expand tax incentives for IRAs (individual retirement accounts) and other retirement savings accounts.

28 How to Allocate Investment? In the Solow model, there is one type of capital In the real world, there are many types, which we can divide into three categories: 1. Private capital stock 2. Public infrastructure 3. Human capital: the knowledge and skills that workers acquire through education How should we allocate investment among these types? i.e. which kind of capital yields the highest marginal products?

29 How to Allocate Investment? Two views on the role of government: 1. Laissez-Faire: Equalize tax treatment of all types of capital in all industries, then let the market allocate investment to the type with the highest marginal product. 2. Intervention: Active Industrial policy, Subsidized Education; Government should actively encourage investment in capital of certain types or in certain industries, because they have high marginal productivity or large positive externalities that private investors do not consider. e.g. Green industries. Public Schooling

30 average growth gdp per capita THA CHN JPN IRL BRB PRT MUS MYS COG IDN ESP GRC ITA AUT FIN IND BRA DOM ISL BEL ISR NOR PAK SYR EGY FRA TUR TTO PANCHL NLD CAN LKA DNK AUS IRN GBR SWE ZWE LSO COL MEX DZA MWI PRY NPL ECU CHE UGAGTM CRI BGD GHA JOR PHL KEN URY ZAF PER ARG SLV JAM GMB CMR HND BEN BOL MLI BDI RWA TGO SEN VEN ZMB MOZ NER NIC average schooling KOR HKG USA NZL Figure The relationship between average growth of GDP per capita and average years of schooling,

31 What is the Role of Institutions? Creating the right institutions is important for ensuring that resources are allocated to their best use: Legal institutions, to protect property rights Capital markets, to help financial capital flow to the best investment projects A corruption-free government to promote competition, enforce contracts, etc. Political freedom (?): e.g. democracy vs. autocracy

32 Endogenous Growth Theories Solow model: sustained growth in living standards is due to technological progress. The rate of technological progress is exogenous. Endogenous growth theory: a set of models in which the growth rate of productivity and living standards is endogenous What policies might encourage faster technological progress?

33 A Basic AK Model Suppose the aggregate production function is Y t = AK t where A is the amount of output for each unit of capital (A is exogenous & constant) Key difference between this model and Solow: MP K is constant here, diminishing in Solow Investment: I = sy Law of motion for total capital: sak t = K t+1 (1 δ)k t

34 A Basic AK Model sak t = K t+1 (1 δ)k t K t+1 K t = (1 + sa δ) Y t Y t = K t K t = sa δ If sa > δ, then income will grow forever, and investment is the engine of growth Here, the permanent growth rate depends on s. In Solow model, it does not.

35 Does Capital Have Diminishing Returns? Depends on definition of capital. If capital is narrowly defined (only plant & equipment), then yes. Advocates of endogenous growth theory argue that knowledge is a type of capital. If so, then constant returns to capital is more plausible, and this model may be a good description of economic growth.

36 A Two-Sector model Two sectors: Manufacturing firms produce goods using the production function Y t = AK α t (E t (1 u)n t ) 1 α Research universities produce knowledge that increases labor efficiency in manufacturing according the production function E t = g(u)e t u = fraction of labor in research and is exogenous Law of motion for total capital: sy t = K t+1 (1 δ)k t

37 A Two-Sector model sy t = K t+1 (1 δ)k t sak α t (E t (1 u)n t ) 1 α E t N t = K t+1 (1 δ)k t E t N t sak α t (1 u) 1 α = (1 + g(u) + n)k t+1 (1 δ)k t With a steady state where f (k, u) = A(1 u) 1 α k α sf (k, u) = (g(u) + n + δ)k Output per worker now grows at a rate g(u)

38 A Two-Sector model s: affects the level of income, but not its growth rate (same as in Solow model) u: affects level and growth rate of income Diminishing returns to capital defined narrowly as K Constant returns to capital broadly defined as K and E (human capital) Question: Would an increase in u be unambiguously good for the economy?

39 Case Study: Growth in China China is an economic juggernaut Population 1.4 billion people

40

41 Economic Superpowers 2006 Rank GDP in trillion US dollars World European Union United States People s Republic of China Japan Germany 3.7

42 Case Study: Growth in China Fast output growth attributable to K Capital Accumulation: Investment is huge in China; at the cost of current consumption, so saving rate s is high N China has a huge labor force; comparative advantage in labor-intensive industries (wages are low). A and E Fast productivity growth, in part from changing to a market economy and increased trade: China s exports were < 10% of GDP in 1980s; now more than 30% China exports many manufactured goods; imports agricultural products and raw materials China runs a small trade surplus

Lecture 12 The Solow Model and Convergence. Noah Williams

Lecture 12 The Solow Model and Convergence Noah Williams University of Wisconsin - Madison Economics 312 Spring 2010 Recall: Balanced Growth Path All per-capita variables grow at rate g. All level variables

Addressing The Marketing Problem of the Social Market Economy

Addressing The Marketing Problem of the Social Prepared for: KAS-Conference on 60 Years of Social Market Economy Sankt Augustin, November 30, 2009 Marcus Marktanner, American University of Beirut Outline

Economic Growth: the role of institutions

ECON 184 Economic Growth: the role of institutions ECON 184: Institutions and Growth January 26, 2010 1 Contents 1 Institutions and growth: initial analysis 3 2 How can institutions affect economic growth?

Macroeconomics II. Growth

Macroeconomics II Growth Growth Possibilities We previously referred to the aggregate production function Y = A K α L 1- α. The growth rate of real GDP, Y, is generated by the contributions of A, K and

In Defense of Wall Street. The Social Productivity of the Financial System

In Defense of Wall Street The Social Productivity of the Financial System Finance is powerful Mobilizes Researches and allocates Monitors and exerts corporate control Provides risk diversification and

Accounting For Cross-Country Income Di erences

Accounting For Cross-Country Income Di erences January 2011 () Aggregation January 2011 1 / 10 Standard Primal Growth Accounting Aggregate production possibilities frontier: where Change in output is )

Finance, Growth & Opportunity. Implications for policy

Finance, Growth & Opportunity Implications for policy Today, I will make three points 1) Finance matters for human welfare beyond crises. 2) Financial innovation is associated with arguably necessary for

Lecture 21: Institutions II

Lecture 21: Institutions II Dave Donaldson and Esther Duflo 14.73 Challenges of World Poverty Institutions II: Plan for the lecture Discussion of assigned reading (Acemoglu, Johnson and Robinson) Causes

The new gold standard? Empirically situating the TPP in the investment treaty universe

Graduate Institute of International and Development Studies Center for Trade and Economic Integration Working Paper Series Working Paper N IHEIDCTEI2015-08 The new gold standard? Empirically situating

Ken Jackson. January 31st, 2013

Wilfrid Laurier University January 31st, 2013 Recap of the technology models Do the models match historical data? growth accounting Estimating technology change through history A revised model of technology

Financial services and economic development

GDP per capita growth 03/11/2014 Financial services and economic development Thorsten Beck Finance why do we care? 0.04 BWA 0.02 0.00-0.02 COG SLE ALB GAB IND KOR TUR SGP MUS SDN MOZ IRLLUX IDN MAR EGY

Export Survival and Comparative Advantage (Work in progress) Regional Seminar on Export Diversification, October 27-28, 2010 Bolormaa Tumurchudur, UNCTAD Miho Shirotori, UNCTAD Alessandro Nicita, UNCTAD

A new metrics for the Economic Complexity of countries and products

A new metrics for the Economic Complexity of countries and products Andrea Tacchella Dept. of Physics, La Sapienza - University of Rome Istituto dei Sistemi Complessi, CNR Roma CRISISLAB ANALYTICS FOR

China: How to maintain balanced growth? Ricardo Hausmann Kennedy School of Government Harvard University

China: How to maintain balanced growth? Ricardo Hausmann Kennedy School of Government Harvard University China s growth process An unprecedented miracle China has been the fastest growing country in the

The Macroeconomic Implications of Financial Globalization

The Macroeconomic Implications of Financial Globalization Eswar Prasad, IMF Research Department November 10, 2006 The views expressed in this paper are those of the author(s) ) only, and the presence of

The Effects of Infrastructure Development on Growth and Income Distribution

The Effects of Infrastructure Development on Growth and Income Distribution César Calderón Luis Servén (Central Bank of Chile) (The World Bank) ALIDE - The World Bank - Banco BICE Reunión Latinoamericana

Economic Complexity and the Wealth of Nations

Economic Complexity and the Wealth of Nations Cesar A. Hidalgo ABC Career Development Professor MIT Media Lab Faculty Associate, Center for International Development Harvard University EARTH WIND WATER

Bringing Up Incentives: A Look at the Determinants of Poverty. Alice Sheehan

Bringing Up Incentives: A Look at the Determinants of Poverty Alice Sheehan Outline presentation What s going on out there? Growth, Human Development indicators, Poverty rates, etc. A look at determinants

Addressing institutional issues in the Poverty Reduction Strategy Paper process

SESSION 1 Addressing institutional issues in the Poverty Reduction Strategy Paper process Scoping notes, detailed diagnostics, and participatory processes Public Sector Reform and Capacity Building Unit

Economic Growth: The Neo-classical & Endogenous Story

Density of countries Economic Growth: The Neo-classical & Endogenous Story EC307 ECONOMIC DEVELOPMENT 1960 Dr. Kumar Aniet University of Cambridge & LSE Summer School Lecture 4 1980 2000 created on July

Infrastructure investment and growth

Infrastructure investment and growth Luis Servén The World Bank IMF, November 2010 Background How important is infrastructure for economic growth? Old question even in Adam Smith s Wealth of Nations Empirically

Does Absolute Latitude Explain Underdevelopment?

AREC 345: Global Poverty and Economic Development Lecture 4 Professor: Pamela Jakiela Department of Agricultural and Resource Economics University of Maryland, College Park Does Absolute Latitude Explain

FACTSHEET. Figure [1]: Economic Complexity Index vs. Opportunity Value (Positive Product Complexity Index, 2011) 2 ESP ITA POL BEL DNK PRT

Opportunity Value Median = -0.06 FACTSHEET Knowledge Economy Assessment of Tunisia - Identifying and addressing capability and innovation gaps in the Southern and Eastern Mediterranean region (SEMED) Overriding

Today s tips for the Country Buy Report

High level outline Today s tips for the Country Buy Report Stephen Malpezzi Introduction Overview of the country and economy Basic indicators (GDP, employment, etc.) Key institutions, the setting How does

Governance, Rule of Law and Transparency Matters: BRICs in Global Perspective

Governance, Rule of Law and Transparency Matters: BRICs in Global Perspective Daniel Kaufmann * Senior Fellow, Brookings Institution http://www.brookings.edu/experts/kaufmannd.aspx Panel on Transparency

Building Capacity in PFM

Building Capacity in PFM Measuring economic governance in the context of national development planning LAMIA MOUBAYED BISSAT Beirut, Lebanon, 13 June 2014 The Institut des Finances Basil Fuleihan 1996

Infrastructure and Economic. Norman V. Loayza, World ldbank Rei Odawara, World Bank

Infrastructure and Economic Growth thin Egypt Norman V. Loayza, World ldbank Rei Odawara, World Bank Motivation Questions How does Egypt compare internationally regarding public infrastructure? Is Egypt

THE QUALITY OF GOVERNMENT CA FOSCARI INTERNATIONAL LECTURE

THE QUALITY OF GOVERNMENT CA FOSCARI INTERNATIONAL LECTURE Andrei Shleifer December 12, 2012 1 Richer countries almost always have better governments Less corrupt More efficient Quality of government improves

Long run growth 2: The Solow model

International Economics and Business Dynamics Class Notes Long run growth 2: The Solow model Revised: November 7, 2012 Latest version available at http://www.fperri.net/teaching/20205.htm Why do we see

A Pragmatic Approach to Capital Account Liberalization. Eswar Prasad Cornell University

A Pragmatic Approach to Capital Account Liberalization Eswar Prasad Cornell University Presentation partly based on my joint work with: Ayhan Kose, Kenneth Rogoff, Shang-Jin Wei (2003, 2006) Raghuram Rajan

Political Economy of Growth

1 Political Economy of Growth Daron Acemoglu Department of Economics, MIT Milan, DEFAP June 11, 2007 The Wealth of Nations Vast differences in prosperity across countries today. Income per capita in sub-saharan

Incen%ves The Good, the Bad and the Ugly

Incen%ves The Good, the Bad and the Ugly Vale Columbia Center Interna%onal Investment Conference New York, Nov 13-14, 2013 Sebas%an James The World Bank Group 1 Prevalence of Tax Incen%ves around the Number

Lecture 9: Institutions, Geography and Culture. Based on Acemoglu s L. Robbins lectures

Lecture 9: Institutions, Geography and Culture Based on Acemoglu s L. Robbins lectures 1 The Wealth of Nations Vast differences in prosperity across countries today. Income per capita in sub-saharan Africa

Natural Resources and Development in the Middle East and North Africa: An Alternative Perspective

Natural Resources and Development in the Middle East and North Africa: An Alternative Perspective Daniel Lederman and Mustapha K. Nabli The World Bank Presentation at the Workshop on Natural Resources

The Marginal Product of Capital. Francesco Caselli. Discussion by

7 TH JACQUES POLAK ANNUAL RESEARCH CONFERENCE NOVEMBER 9-10, 2006 The Marginal Product of Capital Francesco Caselli Discussion by Chang-Tai Hsieh University of California, Berkeley The views expressed

The Fall of the Final Mercantilism

The Fall of the Final Mercantilism Labour Mobility in the Caribbean and the World, from Arthur Lewis to the 21 st Century Eastern Caribbean Central Bank Michael Clemens November 3, 2010 1 2 Migration

Deep Roots of Comparative Development

Deep Roots of Comparative Development Oded Galor AEA Continuing Education Program Lecture III - AEA 2014 Oded Galor Roots of Comparative Development Lecture III - AEA 2014 1 / 41 Deep Roots of Comparative

DEPENDENT ELITES IN POST- SOCIALISM: ARE LAND-BASED POST- COLONIAL SYSTEMS SO DIFFERENT FROM THE TRANSCONTINENTAL ONES? by Pal TAMAS [Institute of

DEPENDENT ELITES IN POST- SOCIALISM: ARE LAND-BASED POST- COLONIAL SYSTEMS SO DIFFERENT FROM THE TRANSCONTINENTAL ONES? by Pal TAMAS [Institute of Sociology, HAS Budapest] STRUCTURE OF THE PAPER 1. STATE

Trade and International Integration: A Developing Program of Research

Trade and International Integration: A Developing Program of Research World Bank Development Economics Research Group Geneva, June 2013 Three areas of focus I. Implications of the changing patterns of

Institutional Change and Growth-Enabling Governance Capabilities

Institutional Change and Growth-Enabling Governance Capabilities Nicolas Meisel Strategy and Research Dept - French Development Agency (AFD) Jacques Ould Aoudia Treasury and Economic Policy Directorate

Overview of Growth Research in the Past Two Decades

Overview of Growth Research in the Past Two Decades by Pete Klenow Stanford University and NBER September 21, 2010 Early Growth Research 1950s Solow (1956) 1960s Nelson and Phelps (1966) 1970s Dark Ages

Life-cycle Human Capital Accumulation Across Countries: Lessons From U.S. Immigrants

Life-cycle Human Capital Accumulation Across Countries: Lessons From U.S. Immigrants David Lagakos, UCSD and NBER Benjamin Moll, Princeton and NBER Tommaso Porzio, Yale Nancy Qian, Yale and NBER Todd Schoellman,

Advanced Economic Growth: Lecture 1, Introduction

Advanced Economic Growth: Lecture 1, Introduction Daron Acemoglu MIT September 5, 2007. Daron Acemoglu (MIT) Advanced Growth Lecture 1 September 5, 2007. 1 / 48 0.00005.0001.00015.0002.00025 Density of

2006/SOM1/ACT/WKSP/007a Recasting Governance for the XXI Century - Presentation

2006/SOM1/ACT/WKSP/007a Recasting Governance for the XXI Century - Presentation Submitted by: Miguel Schloss, Managing Partner DamConsult Ltd. APEC Workshop on Anti-Corruption Measures for the Development

Fear of flying: Policy stances in a troubled world economy

Fear of flying: Policy stances in a troubled world economy UNCTAD G-24 Technical Meeting Luxor, 10-11 March 2014 Session 1 Global Economy A weakening economic performance reflects inability to address

Agriculture and Aggregate Productivity: A Quantitative Cross-Country Analysis

Agriculture and Aggregate Productivity: A Quantitative Cross-Country Analysis Diego Restuccia University of Toronto Dennis Tao Yang Virginia Polytechnic Institute Xiaodong Zhu University of Toronto March

Estimating Global Migration Flow Tables Using Place of Birth Data

Estimating Global Migration Flow Tables Using Place of Birth Data Guy J. Abel Wittgenstein Centre (IIASA, VID/ÖAW, WU) Vienna Institute of Demography/Austrian Academy of Sciences 1 Introduction International

Trade Policy Restrictiveness in Transportation Services

Trade Policy Restrictiveness in Transportation Services Ingo Borchert, Batshur Gootiiz and Aaditya Mattoo Development Research Group Trade and International Integration, The World Bank OECD Expert Meeting

ECON 260 Theories of Economic Development. Instructor: Jorge Agüero. Fall 2008. Lecture 1 September 29, 2008 1

ECON 260 Theories of Economic Development. Instructor: Jorge Agüero. Fall 2008. Lecture 1 September 29, 2008 1 General information Time and location: TR 2:10-3:30 p.m. SPR 3123 Office hours: T 10am-11am,

Subjective Well-Being, Income, Economic Development and Growth

Subjective Well-Being, Income, Economic Development and Growth Dan Sacks, Betsey Stevenson and Justin Wolfers Wharton School, University of Pennsylvania and NBER Annual Bank Conference on Development Economics--Stockholm,

NGO PERSPECTIVE: FROM WORDS TO DEEDS

MMSD & IIED Managing Mineral Wealth NGO PERSPECTIVE: FROM WORDS TO DEEDS Miguel Schloss Executive Director Transparency International Issues Policy distortions Institutional incentives Governance Implications

Non-market strategy under weak institutions

Lectures 5-6 Non-market strategy under weak institutions 1 Outline 1. Does weakness of institutions matter for business and economic performance? 2. Which institutions matter most? 3. Why institutions

Rethinking the Wealth of Nations. Daron Acemoglu, MIT FEEM Lecture, December 14, 2009.

Rethinking the Wealth of Nations Daron Acemoglu, MIT FEEM Lecture, December 14, 2009. 1 The Failure of Nations Vast differences in prosperity across countries today. Income per capita in sub-saharan Africa

Measuring the Pollution Terms of Trade with Technique Effects

Measuring the Pollution Terms of Trade with Technique Effects Jean-Marie Grether, University of Neuchâtel Nicole Mathys, Swiss Federal Office of Energy and University of Neuchâtel Conference on the International

The contribution of trade in financial services to economic growth and development. Thorsten Beck

The contribution of trade in financial services to economic growth and development Thorsten Beck Finance why do we care? 0.04 BWA GDP per capita growth 0.02 0.00-0.02 COG SLE ALB GAB IND KOR TUR SGP MUS

Measuring Services Trade Restrictions Aaditya Mattoo (based on research with Ingo Borchert and Batshur Gootiiz) Development Research Group The World Bank 11 March 2012 Motivation: Policy Transparency and

Technology Choice. Francesco Caselli. Summer School 2005

Technology Choice Francesco Caselli Summer School 2005 1 Motivation All of the evidence and all of the models we have studied so far assume that cross-country technology differences are factor-neutral.

Human Rights and Governance: The Empirical Challenge. Daniel Kaufmann World Bank Institute. www.worldbank.org/wbi/governance/

Human Rights and Governance: The Empirical Challenge Daniel Kaufmann World Bank Institute www.worldbank.org/wbi/governance/ Presentation at Human Rights and Development: Towards Mutual Reinforcement Conference,

Human Resources for Health Why we need to act now

Human Resources for Health Why we need to act now Progress towards the MDGs, particularly in Africa is slow, or even stagnating. Poor people cannot access basic services for want of doctors, nurses and

Subjective Well Being, Income, Economic Development and Growth

Subjective Well Being, Income, Economic Development and Growth Dan Sacks, Betsey Stevenson and Justin Wolfers Wharton School, University of Pennsylvania and NBER CSLS ICP Conference on Happiness December

Institute for Development Policy and Management (IDPM)

Institute for Development Policy and Management (IDPM) Development Economics and Public Policy Working Paper Series WP No. 33/212 Published by: Development Economics and Public Policy Cluster, Institute

Infrastructure and Economic Growth in Egypt

Public Disclosure Authorized Policy Research Working Paper 5177 WPS5177 Public Disclosure Authorized Public Disclosure Authorized Infrastructure and Economic Growth in Egypt Norman V. Loayza Rei Odawara

Does Export Concentration Cause Volatility?

Does Export Concentration Cause Volatility? Christian Busch 14. Januar 2010 Overview Countries with undiversified export structure are plausibly more vulnerable to external shocks. But difficult to evaluate

TRADE WATCH DATA JANUARY T RVSFRRTVL

Public Disclosure Authorized TRADE WATCH DATA JANUARY T RVSFRRTVL Public Disclosure Authorized A C F D H T W B DECRG Public Disclosure Authorized Public Disclosure Authorized *TRADE WATCH is a monthly

Growing Together with Growth Polarization and Income Inequality

Growing Together with Growth Polarization and Income Inequality Sudip Ranjan Basu, Ph.D. Economist, United Nations ESCAP UN DESA Expert Group Meeting on the World Economy (LINK Project) United Nations

On the Evolution of the World Income Distribution

On the Evolution of the World Income Distribution Charles I. Jones Department of Economics Stanford University Stanford, CA 94305 Chad.Jones@Stanford.edu March 29, 1997 Version 1.00 Abstract The post-world

Relative Prices and Sectoral Productivity

Relative Prices and Sectoral Productivity Margarida Duarte University of Toronto Diego Restuccia University of Toronto August 2012 Abstract The relative price of services rises with development. A standard

Rodolfo Debenedetti Lecture

Rodolfo Debenedetti Lecture Andrei Shleifer March 2005 Legal Origin Distribution Legal Origins = English = French = German = Scandinavian = Socialist Institution Procedural Formalism Outcomes Time to evict

Tripartite Agreements for MEPC.2/Circ. Lists 1, 3, 4 received by IMO following issuance of MEPC.2/Circ.20

The following is a list of tripartite agreements reported to IMO during the period between the issuance of the annual MEPC.2/Circular, disseminated in December of each year. Any countries wishing to join

Movement and development. Australian National University Jan. 17, 2013 Michael Clemens

Movement and development Australian National University Jan. 17, 2013 Michael Clemens ? 60% Benefits Little Haiti Cap-Haïtien Gibson and McKenzie 2010 Tongan seasonal workers in NZ NZ\$1,400/family

Political Economy of Development and Underdevelopment

Political Economy of Development and Underdevelopment Daron Acemoglu Department of Economics Massachusetts Institute of Technology October 10, 2005 The State of the World Economy Vast differences in prosperity

Geography and Economic Transition

Global Spatial Analysis at the Grid Cell Level Mesbah Motamed Raymond Florax Will Masters Department of Agricultural Economics Purdue University March 2009 Urbanization at the grid cell level Growth regimes

Econ 1340: World Economic History

Econ 1340: World Economic History Lecture 16 Camilo Gracía-Jimeno University of Pennsylvania April 4, 2011 Camilo Gracía-Jimeno (University of Pennsylvania)Econ 1340: World Economic History April 4, 2011

Financial Liberalization and Capital Flows: Facts

Financial Liberalization and Capital Flows: Facts Alberto Martin CREI, Universitat Pompeu Fabra and Barcelona GSE July 2014 The rise of nancial globalization Since the late 1970s Dramatic increase in nancial

Informality in Latin America and the Caribbean

WPS4888 Policy Research Working Paper 4888 Informality in Latin America and the Caribbean Norman V. Loayza Luis Servén Naotaka Sugawara The World Bank Development Research Group Macroeconomics and Growth

Diversification versus Polarization: Role of industrial policy in Asia and the Pacific

TOWARDS A RETURN OF INDUSTRIAL POLICY? ARTNeT SYMPOSIUM 25-26 JULY 211 ESCAP, BANGKOK Diversification versus Polarization: Role of industrial policy in Asia and the Pacific Sudip Ranjan Basu* International

The geography of development within countries

The geography of development within countries J. Vernon Henderson Brown University & NBER June 2012 GDN 13TH ANNUAL GLOBAL DEVELOPMENT CONFERENCE Urbanization and Development: Delving Deeper into the Nexus

Tripartite Agreements for MEPC.2/Circ. Lists 1, 3, 4 received by IMO following issuance of MEPC.2/Circ.21

The following is a list of tripartite agreements reported to IMO during the period between the issuance of the annual MEPC.2/Circular, disseminated in December of each year. Any countries wishing to join

A Survey of Securities Laws and Enforcement

A Survey of Securities Laws and Enforcement Preliminary Draft By Florencio Lopez-de-Silanes YALE University and NBER October 2003 *I am indebted to Patricio Amador, Jose Caballero and Manuel Garcia-Huitron

Employment, Structural Change, and Economic Development. Dani Rodrik March 15, 2012

Employment, Structural Change, and Economic Development Dani Rodrik March 15, 2012 A remarkable reversal in fortunes since 1990s -.04 -.02 0.02.04.06 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000

The Shift to Government Banking:

The Shift to Government Banking: Risks for the Netherlands and other Developed Countries Prof. Florencio Lopez de Silanes EDHEC Business School, NBER and DSF April 28, 2011 Amsterdam Outline I. The Policy

Gender Inequality, Income, and Growth: Are Good Times Good for Women?

POLICY RESEARCH REPORT ON GENDER AND DEVELOPMENT Working Paper Series, No. 1 Gender Inequality, Income, and Growth: Are Good Times Good for Women? David Dollar Roberta Gatti Gender differentials in education

EC 2725 April 2009. Law and Finance. Effi Benmelech Harvard & NBER

EC 2725 April 2009 Law and Finance Effi Benmelech Harvard & NBER Broad Picture A market economy is not only laissez faire but it also requires a set of institutions that allow markets to work their magic.

Trends in global income inequality and their political implications

Trends in global income inequality and their political implications LIS Center; Graduate School City University of New York Talk at the Stockholm School of Economics, September 1, 2014 A. National inequalities

Metrics Matters: Measures of Governance and Security and the Business Perspective An initial empirical exploration

Metrics Matters: Measures of Governance and Security and the Business Perspective An initial empirical exploration Daniel Kaufmann, World Bank Institute www.worldbank.org/wbi/governance For presentation

The distribution of household financial contributions to the health system: A look outside Latin America and the Caribbean

The distribution of household financial contributions to the health system: A look outside Latin America and the Caribbean Priyanka Saksena and Ke Xu 3 November, 2008 Santiago 1 The distribution of household

The Role of Trade in Structural Transformation

1 The Role of Trade in Structural Transformation Marc Teignier UNIVERSIDAD DE ALICANTE European Summer Symposium in International Macroeconomics 23 May 2012, Tarragona Question Contributions Road Map Motivation

Informality in Latin America and the Caribbean

Public Disclosure Authorized Policy Research Working Paper 4888 WPS4888 Public Disclosure Authorized Public Disclosure Authorized Informality in Latin America and the Caribbean Norman V. Loayza Luis Servén

14.452 Economic Growth: Lecture 4, The Solow Growth Model and the Data

14.452 Economic Growth: Lecture 4, The Solow Growth Model and the Data Daron Acemoglu MIT November 8, 2011. Daron Acemoglu (MIT) Economic Growth Lecture 4 November 8, 2011. 1 / 52 Mapping the Model to

Specialization Patterns in International Trade Walter Steingress November 16, 2015 Abstract The pattern of specialization is key to understanding how trade affects the production structure of an economy.

Fertility Convergence

Fertility Convergence Tiloka De-Silva a Silvana Tenreyro a,b a London School of Economics, CfM; b CEP, CEPR July 2015 Abstract A vast literature has sought to explain large cross-country differences in

Online Appendix to The Missing Food Problem: Trade, Agriculture, and International Income Differences

Online Appendix to The Missing Food Problem: Trade, Agriculture, and International Income Differences Trevor Tombe, Uversity of Calgary Contents 1 Proof of Propositions 2 2 Data and Sample of Countries

COMPLEXITY AND INDUSTRIAL POLICY

IPD/JICA Task Force on Industrial Policy and Transformation Amman, Jordan, June 5-6, 2014 COMPLEXITY AND INDUSTRIAL POLICY Luciano Pietronero Measuring the Intangible Growth Potential of Countries Collaborators:

Pro-Poor Growth in Brazil: Where does the Country Stand?

Pro-Poor Growth in Brazil: Where does the Country Stand? Edinaldo Tebaldi, PhD Bryant University - USA Laboratório de Estudos da Pobreza - CAEN/UFC/Brazil Outline Poverty Trends in Brazil Brazil s poverty

Evaluation with stylized facts

Evaluation with stylized facts AMPERE Subgroup on IAM Validation Valeria Jana Schwanitz Potsdam Institute for Climate Impact Research 27. Mai 2013 Content Fundamental laws and stylized facts Systematic

The Global Crisis in Low- and Middle-Income Countries: How the IMF Responded

The Global Crisis in Low- and Middle-Income Countries: How the IMF Responded Andrea F. Presbitero Alberto Zazzaro 1 Università Politecnica delle Marche 2 Money and Finance Research group (MoFiR) Real and

Financial Integration and Deepening: Are Poor Countries Lagging?

Financial Integration and Deepening: Are Poor Countries Lagging? Mark M. Spiegel Vice President Economic Research Federal Reserve Bank of San Francisco Prepared for conference on Capital Flows, Monetary