A large body of empirical research indicates that countries with low policy-induced trade barriers tend to enjoy rapid growth, ceteris paribus. In contrast, alternative theoretical models suggest that the relationship between trade barriers and growth may be contingent on the level of...

This paper explores the quantitative implications of a class of endogenous growth models for cross-country income differences. These models exhibit international spillovers, no scale effects and conditional convergence, and thus they overcome some difficulties faced by the early generation of...

This paper uses a two-sector general equilibrium model to analyse both steady-state and stochastic dynamic effects of two real exchange rate targeting policies: a constant-target, and a band-target rule. In the model, targeting is implemented by imposing a stochastic fully-rebatable tax on the...

Life expectancy around the world has increased substantially since 1970. In contrast, consumption per capita has fallen in some countries, remained stagnant, or sharply increased in others. What are the welfare gains of the systematic increase in life expectancy around the world? How does a...

Most education around the globe is public. Moreover, invest rates in education as well as schooling attainment differ substantially across countries. We contruct a general equilibrium life-cycle model that is consistent with these facts. We provide simple analytical solutions for the optimal...

This paper studies fertility decisions in an Aiyagari-Huggett economy extended to include endogenous fertility. The challenge is to explain both why fertility decreases with income, and why there is intergenerational persistence of inequality. The model features non-isoelastic altruism,...

Dynastic models common in macroeconomics use a single parameter to control the willingness of individuals to substitute consumption both intertemporally, or across periods, and intergenerationally, or across parents and their children. This paper defines the concept of Elasticity of...

Dynastic models common in macroeconomics use a single parameter to control the willingness of individuals to substitute consumption both intertemporally, or across periods, and intergenerationally, or across parents and their children. This paper defines the concept of Elasticity of...