type="main" <title type="main">ABSTRACT</title> <p>High growth and progressive regions possess a culture that promotes innovation. Innovation depends on a region's ability to use its own existing knowledge and knowledge generated elsewhere. This paper demonstrates the importance of the ability to absorb external knowledge in...</p>

In a 1989 paper, B. Taub showed, contrary to T. Bewley's conjecture, that when income is subject to an aggregate shock, inflation may be the optimal policy. This paper shows that the inflation result is due to an algebraic mistake in the calculation of the first-order condition. When income is...

This paper considers the problem of regional allocation of government funds in a two-region, two-good economy in which production of each good requires labor, capital, and a local public good. Changes in regional allocation of federal expenditures and public services are found to significantly...