This article presents a summary of our conversation on the past, present and future of the new economic geography, which took place with the help of an interlocutor in San Juan, Puerto Rico in November 2002. Following the introduction, we explain what the new economic geography is, and we describe some basic models. The discussion of its various critical aspects is presented subsequently, and t...

Two approaches taken to the embodiment question are compared and discussed: quantitative theory and traditional growth accounting. The two approaches give very different estimates for the contribution of investment-specific technological advance to economic growth. Therefore, the approach taken matters. It is argued that the measures used in traditional growth accounting to gauge the importance...

This paper provides an overview of methodologies used to analyze inter-regional income inequality, and a critical survey of empirical studies that deal with Russian regions. It discusses implications of the growth theory regarding dynamics of inter-economy income inequality. Methodologies for empirically analyzing income inequality are classified as the cross-section approach, time series appro...

We present a prospect theory model to explain why power transitions do not necessarily lead to war. We find that three major mechanisms prevent the occurrence of potential power transition wars. First, the dual boiling frog effects occurring in the middle range of capability catching-up rate prevent a dominant state from preempting and a rising state from challenging the other side. Second, div...

Williamson (1965) argued that catching up countries experiencing strong national growth tend also to see a widening in regional disparities, whereas in more developed economies strong national growth and falling regional disparities could go hand in hand. We find some evidence of a trade-off between national growth and regional dispersion in the EU’s Cohesion countries, notably in Spain and Ire...

in this research, the attempt was made to test the existence of the natural rate hypothesis in iran, by using a johansson cointegration test. the results do not reveal any long run relationship between inflation and unemployment in iran for 1340-1386 periods. because of the time varying nature of nairu, the hp filter was applied to estimate the time series of nairu. comparing the nairu time ser...

This paper examines the role for tax policies in productivity-shock driven economies with catching-up-with-the-Joneses utility functions. The optimal tax policy is shown to affect the economy countercyclically via procyclical taxes, i.e., “cooling down” the economy with higher taxes when it is “overheating” in booms and “stimulating” the economy with lower taxes in recessions to keep consumptio...

In this paper, we explore the dynamic properties of an endogenous growth model with finite patent length. We show that there exists a unique equilibrium growth path and that this path exhibits damped oscillations in contrast to the equilibrium path of an endogenous growth model with infinite patent length.We also examine the effects of patent policy on social welfare and show that infinite pate...

We study the co-evolution of social participation and social capital accumulation, taking the view that the former contributes to the latter, and both contribute to socially enjoyed leisure. We show that a process of substitution of private for social activities (observable in some advanced, affluent economies), might be self-reinforcing and lead to a Pareto-dominated steady state. We find some...

Based on the recursive preference approach, the dynamic and global properties of the two-country open economy are examined with one good and inputs of labor and capital, with capital being freely traded internationally. First by showing that the world’s consumption increases (resp. decreases) with an increase (resp. decrease) in the world’s capital, the global stability of the economy is obtain...