We present a model of optimal government policy when policy choices may exacerbate socio-political instability (SPI). We show that optimal policy that takes into account SPI transforms a standard concave growth model into a model with both a poverty trap and endogenous growth. The resulting...

This paper constructs a heterogenous agent model of endogenous distribution and growth. When the labor leisure choice of agents is exogenous, the factor holding ratios of households converges to a mass point that is independent of the initial distribution of capital in the steady state. There is...

We study the sectoral allocation of public infrastructure investments in the agriculture and manufacturing sectors in India. In addition to the changing employment and output shares of these two sectors, the capital output ratio in agriculture in India has fallen, while it has risen in...

Chapter 1: Overview of the 2 Sector Mahalanobis Model -- Chapter 2: Critiques of the 2 Sector Mahalanobis Model -- Chapter 3: A Stochastic Version of the 2 Sector Mahalanobis Model -- Chapter 4: Open Economy Extensions of the 2-sector Mahalanobis Model -- Chapter 5: Overview of the 4 Sector...