With decreasing returns and first-best credit, the long-run interest rate and aggregate output are uniquely determined, and wealth dispersion among individuals or firms is irrelevant. Introducing credit rates and wealth distributions can exist because higher initial rates can be self-reinforcing...

This paper develops a model where voters trade-off two different motives when deciding how to vote: they care about current decision-making (they are "strategic"), but they also care about communicating their views about their most-preferred candidate so as to influence future elections, by...

This article uses variation in access to a targeted lending program to estimate whether firms are credit constrained. While both constrained and unconstrained firms may be willing to absorb all the directed credit that they can get (because it may be cheaper than other sources of credit),...

The authors examine the interactions between different institutional arrangements in a general equilibrium model of a modernizing economy. There is a modern sector, where productivity is high but information asymmetries are large, and a traditional sector where productivity is low but...

This paper studies the effect of community identity on investment behaviour inthe knitted garment industry in the South Indian town of Tirupur. We documentvery large and systematic differences in both levels of capital stock and thecapital intensity of production in firms owned by people from...

This paper studies the effect of community identity on investment behaviour in the knitted garment industry in the South Indian town of Tirupur. We document very large and systematic differences in both levels of capital stock and the capital intensity of production in firms owned by people from...