Since Max Weber, there has been an active debate on the impact of religion on people’s economic attitudes. Much of the existing evidence, however, is based on cross-country studies in which this impact is confounded by differences in other institutional factors. We use the World Values Surveys...

Piketty's Capital in the Twenty-First Century posits the return r on capital to be larger than the economic growth rate g as a main driver of inequalities. This article points out the circumstances under which the reverse inference holds. We show that increasing inequality promotes increasing...

Economic growth depends not only on how people make decisions but also upon how their decisions are coordinated. Because of this, aggregate outcomes can diverge from individual intentions. I illustrate this with reference to the modern literature on economic growth, and also with reference to an...

After some historical discussion of the rational expectations (RE) solution procedures of John Muth, Alan Walters, and Robert Lucas, this paper considers the relevance for actual economies of issues stemming from the existence of multiple RE equilibria. In all linear models, the minimum state...

This paper studies how producers' idiosyncratic risks affect an industry's aggregate dynamics in an environment where certainty equivalence fails. In the model, producers can place workers in two types of jobs, organized and temporary. Workers are less productive in temporary jobs, but creating...

Motivated by recent developments in the bounded rationality and strategic complementarity literatures, we examine an intentionally simple and stylized aggregative economic model, when the assumptions of fully rational expectations and no strategic interactions are relaxed. We show that small...

Using a two-good, two-country model, we examine macroeconomic adjustment by allowing for decreasing and increasing marginal impatience (DMI and IMI). In the reference case where both countries have IMI, a negative output shock in one country lowers the interest rate and both countries' welfare...

This paper investigates the magnitude of geographic as well as commodity concentration for Malaysia from 1970 to 2003 and how the pattern of trade and instability has changed over time. The instability index is regressed upon a set of explanatory variables including commodity concentration,...

We identify cyclical turning points for 74 U.S. manufacturing industries and uncover new empirical regularities: (a) industries tend to comove between expansion and contraction phases over the business cycle; (b) clusters of industry turning points are highly asymmetric between peaks and troughs:...

This paper is a critical review of and a reader's guide to a collection of papers by Robert E. Lucas, Jr. about fruitful ways of using general equilibrium theories to understand measured economic aggregates. These beautifully written and wisely argued papers integrated macroeconomics,...