The paper analyses a two-sector model of endogenous growth with two common features of economic development: stages of sustained growth and underdevelopment traps. The model also demonstrates the transitional issues of a temporary underdevelopment trap, seemingly sustainable growth, and a...

We analyze the steady state and transitional dynamics of two-sector model with structural change and horizontal innovation. There are three main economic forces could drive structural change: technological progress in one sector, technological progress in the other sector, and capital deepening....

This paper develops a model of unified growth based on a positive feed back between growth and longevity. The model explains the historical development of industrialized countries as well as why tropical countries did not follow the same path. It also gives a mechanism for conditional...

A simple model incorporating rent-seeking into the standard neoclassical model of capital accumulation is presented. It embodies the idea that the performance of an economy depends on the efficiency of its institutions. It is shown that welfare is positively affected by the institutional...

We study the macroeconomic effects of international trade policy by integrating a Hecksher-Ohlin trade model into an optimal growth framework. The model predicts that an open economy will have higher factor productivity. Furthermore, under protectionist policies there may be "development traps,"...

We show that even in the absence of diminishing returns in production and technological spillovers, international trade leads to a stable world income distribution. This is because specialization and trade introduce de facto diminishing returns: Countries that accumulate capital faster than...