The technological constraints on sustaining production chains have been discussed extensively by development economists, but the role of financial linkages has received less attention. In a model of recursive moral hazard for a manufacturing supply chain, we show that the structure of...

An endogenous growth model with heterogeneous agents is analyzed to show that “human capital flight” or “brain drain” can lead to a permanent reduction in income and growth of the country of emigration relative to the country of immigration. Convergence between the two is therefore...

This paper presents a framework for quantitatively evaluating the macroeconomic effects of corporate restructuring and applies that framework to Japan. Using firm-level financial statement data, this paper estimates total factor productivity of individual Japanese firms. Given the estimated...