R&D investment are an important engine of growth and development. Yet economists have often claimed under-investment, also due to the asymmetric information between inside investors and outside investors and financiers, and the consequent capital and financial market imperfections. Some recent...

Imports of goods that embody foreign technology raise a country's output directly, as inputs into production, and indirectly, through reverse-engineering of these goods which contributes to domestic imitation and innovation. This paper first quantifies spillovers from high technology imports...

We study a dynamic general equilibrium model where innovation takes the form of the introduction new goods, whose production requires skilled workers. Innovation is followed by a costly process of standardization, whereby these new goods are adapted to be produced using unskilled labor. Our...

This paper explores the theoretical channels by which financial crises might have an impact on long-run growth. By exploiting occasionally binding financial constraints, we produce a model that generates endogenous crisis episodes featuring permanent falls in productivity, without generating...

We study a dynamic general equilibrium model where innovation takes the form of the introduction new goods, whose production requires skilled workers. Innovation is followed by a costly process of standardization, whereby these new goods are adapted to be produced using unskilled labor. Our...

Of the diverse factors motivating technological change, one factor that has received increasing attention in the recent past has been the protection of intellectual property rights. Given fairly recent changes in the international policy ethos where a regime of stronger intellectual property...

What is the relationship between inequality and growth? This question has occupied and fascinated social scientists for more than a century. This article critically reviews the recent empirical and theoretical literature on the complex interplay between inequality and economic growth. Inequality...

Unemployment occurs because workers and firms have control over wages and prices. The exercise of market power over wages interacts with its exercise over prices. Understanding this interaction sheds new light on the effects of policy interventions on unemployment and growth. Reforms that result...

In the conventional neoclassical growth model, technical change is generally characterized as “purely labor-augmenting,” a restriction that limits modern civilization to super-humans living in the Stone Age. As a novel and radical departure from conventional growth theory, the model...

We analyze the relative growth performance of open economies in a two-country model where different endowments of labor and a natural resource generate asymmetric trade. A resource-rich economy trades resource-based intermediates for final manufacturing goods produced by a resource-poor economy....