The growth theories of the 1950s and 1960s emphasized capital accumulation and technical progress as explanations of growth. More recently theoretical attention has focused on the understanding of progress in terms of learning/human capital (in the tradition of K. Arrow) and investment in...

An iconic model with high leverage and overvalued collateral assets is used to illustrate the amplification mechanism driving asset prices to 'overshoot' equilibrium when an asset bubble bursts - threatening widespread insolvency and what Richard Koo calls a 'balance sheet recession'. Besides...

An earlier paper showed that an economy could be trapped in an equilibrium state in which the absence of the rule of law led to asset-stripping and the prevalence of asset-stripping led to the absence of a demand for the rule of law, highlighting a coordination failure. This article looks more...