Both the quality and quantity of human capital are important for growth. Although the quality aspects of human capital may have greater potential in explaining growth, given that the quantity effects of human capital have been found to be ambiguous, they have long been ignored in empirical growth literature. This paper empirically tests the joint effects of both the quantity and quality of huma...

This paper studies the implications for the long-run world income distribution (WID) of two possible knowledge spillovers structures: appropriate technology and backward knowledge spillovers. In an appropriate technology framework, where total factor intensity is an index of the technological level of an economy, countries will grab useful knowledge only from their technological neighborhood, t...

The paper extends Breggren et al. (2008, EE) on ‘trust and growth: a shaky relationship” by incorporating recent developments in the trust-growth literature and using a robust methodological underpinning that accounts for the presence of outliers. The empirical evidence is based on 63 countries. Two main findings are established. First, the substantially documented positive trust-growth nexus i...

A broad and popular class of innovation-based endogenous growth models implies that the steady-state growth rate of per capita output is increasing in the steady-state inducement to innovate. This paper presents evidence that in the sample periods 18901929 and 1947-1998, the US economy can be characterized as having fluctuated around two distinct steady states. It then quantifies the relationsh...

This paper addresses the issue of causality in the relationship between various types of institutions—namely, political and economic freedom—and long-run economic growth. It is shown that existing empirical studies of these relationships provide evidence of correlation, but not causation. Granger causality tests of freedom vs. growth, and freedom vs. investment are conducted using aggregate mea...

We propose an economic theory of infectious disease transmission and rational behavior. Diseases are costly due to mortality (premature death) and morbidity (lower productivity and quality of life). The theory offers three main insights. First, higher disease prevalence implies lower saving-investment propensity. Preventive behavior can partially offset this when the prevalence rate and negativ...

This paper takes a global, long‐run perspective on the recent debate about secular stagnation, which has so far mainly focused on the short term. The analysis is motivated by observing the interplay between the economic and demographic transition that has occurred in the developed world over the past 150 years. To the extent that high growth rates in the past have partly been the consequence of...

In every developed country, the economic transition from pre-industrial stagnation to modern growth was accompanied by a demographic transition from high to low fertility. Even though the overall pattern is repeated, there are large cross-country variations in the timing and speed of the demographic transition. What accounts for falling fertility during the transition to growth? To answer this ...

Using a simple stochastic growth model, this paper demonstrates that the coefficient of variation of aggregate output or GDP does not necessarily go to zero even if the number of sectors or economic agents goes to infinity. This phenomenon known as non-self-averaging implies that even if the number of economic agents is large, dispersion can remain significant, and, therefore, that we can not l...

Over time the international development community has advocated various development paradigms, but countries following these paradigms have often performed poorly. I provide an explanation for this poor performance. In my model the political leader of a developing country chooses a policy and whether to implement it in an honest or corrupt manner. These choices affect domestic production and ai...