Based on a neoclassical growth model for open low income economies this paper shows that development strategies, which rely on net borrowing abroad lead to a position of sustainable foreign indebtedness (provided that all capital imports are used for investment financing), but turn out to be...

We present an OLG model in which life expectancy and environmental quality dynamics are jointly determined. Agents may invest in environmental care, depending on how much they expect to live. In turn, environmental conditions affect life expectancy. As a result, our model produces a positive...

The combination of consumer preferences, technological changes, and different income elasticities among goods and services can generate inequalities among agents leading to winners and losers. Inspired by these mechanisms, we pose the following research question: "Can immiserizing growth (IG)...

Conditions for the occurrence of immiserizing growth and the Metzler paradox are analysed in the Ricardian model when consumers in the foreign country have Leontief preferences while consumers in the home country have Cobb-Douglas preferences. By using specific functional forms, the conditions...

This paper explores the ramifications of international outsourcing on unemployment, income distribution and welfare, which is an important but yet unresolved issue. Using the well-known Harris-Todaro (1970) model of sector-specific unemployment, it shows that the effects of outsourcing on...

A rising competitive pressure for innovations comes along with an increasing number of companies and public research facilities that include external sources of information into the innovation process. This trend towards an open innovation process can be verified empirically. External R&D...

The EU agenda for improving competitiveness is missing in action. Economic competitiveness has been a central plank in the development of the European Union - a relentless quest for policies that lead to more prosperity and that make European companies in world markets more successful. However,...

This paper provides a comprehensive theoretical model of the political decision making process. Therein two ideologically different political parties compete for power. Their primary instrument in this competition are programmatic concessions in favor of voters and interest groups. As any...