This paper develops a dynamic model of trade and growth that we use to study how openness affects economic growth. In our model, heterogeneous firms choose to either produce with their existing technology or search within the domestic economy to adopt a better technology. These choices determine...

Perla and Tonetti (2014) and Lucas and Moll (2014) study technology diffusion in isolation, in environments without the generation of new ideas. Without new ideas, growth cannot continue forever if there is a finite technology frontier. This paper examines, in an economy in which firms choose to...

While much of recent growth literature has focused on innovation in the technology frontier, less attention has been paid to the role of the least productive agents in generating growth. We develop an analytically tractable model where growth is created as a positive externality from risk taking...

This paper studies international technology and idea flows and their effects on growth and the welfare gains from openness. We analyze a model where producers decide either to acquire productivity-increasing ideas through search or to produce domestically and potentially for export with their...

Will fast growing emerging economies sustain rapid growth rates until they “catch-up” to the technology frontier? Are there incentives for some developed countries to free-ride off of innovators and optimally “fall-back” relative to the frontier? This paper models agents growing as a...

How do reductions in barriers to international trade affect aggregate economic growth and welfare? We develop a novel dynamic model of growth and trade, driven by technology adoption, to better understand the interaction between technology diffusion, openness, and growth. In the model,...

The least productive agents in an economy can be vital in generating growth by spurring technology diffusion. We develop an analytically tractable model in which growth is created as a positive externality from risk taking by firms at the bottom of the productivity distribution imitating more...

Will fast growing emerging economies sustain rapid growth rates until they "catch-up" to the technology frontier? Are there incentives for some developed countries to free-ride off of innovators and optimally "fallback" relative to the frontier? This paper models agents growing as a result of...

The exposure of US Treasury bonds to the stock market has moved considerably over time. While it was slightly positive on average in the period 1960-2011, it was unusually high in the 1980s and negative in the 2000s, a period during which Treasury bonds enabled investors to hedge macroeconomic...