The free movement of capital across borders has created, and will certainly continue to create, enormous economic benefits. Capital flows afford developing countries and other regions the means to exploit promising investment opportunities, while providing savers around the globe the means both to earn higher returns and to reduce risk through international portfolio diversification. Access to ...

This paper investigates the relationship between capital account openness and the share of labour in national income. Employing a new index of financial openness and a cross-country panel of labour shares available from the United Nations System of National Accounts, the author shows a robust negative correlation between the degree of openness and the labour share. Although this effect is not p...

We calibrate a sequence of four nested models to study the dynamics of wealth accumulation. Individuals maximize a utility function whose arguments are consumption and investment. They desire to accumulate wealth for its own sake – this is not a life-cycle model. A competitive firm produces a single good from labor and capital; the rate of return to capital and the wage rate are market-clearing...

This paper assesses the impact of investmentand education-specific technical change on occupational transition and the skill premium in a model with human capital. In this framework, human capital augments labour productivity and also facilitates the transition to skilled employment. In line with empirical evidence, this setup predicts that an increase in the productivity of physical capital (i...