This paper develops a two-sector R&D-based growth model with congestion effects from increasing urban population density. We show that endogenous technological progress causes structural change if there are positive productivity spillovers from the modern to the traditional sector and Engel’s...

R&D-based growth theory suggests that a larger population size raises either the long-run rate of economic growth (“strong scale effect”) or the level of per capita income (“weak scale effect”), with far-reaching policy implications. However, for modern times there is little empirical...

Previous research on optimal R&D subsidies has focussed on the long run. This paper characterizes the optimal time path of R&D subsidization in a semi-endogenous growth model, by exploiting a recently developed numerical method. Starting from the steady state under current R&D subsidization in...

We consider an R&D-driven endogenous growth model in which innovation is risky and agents are risk averse. Growth is determined by the occupational choice of agents who can either work in production for a wage or become entrepreneurs. In this context, we examine the impact of redistributive...

Long run economic growth goes along with structural change. Recent work has identified explanatory factors on the demand side (non-homothetic preferences) and on the supply-side, in particular differential productivity growth across sectors and differences in factor proportions and capital...

The optimal mix of growth policies is determined within a comprehensive endogenous growth model. The analysis captures important elements of the tax-transfer system and accounts for transitional dynamics. Currently, for calculating corporate taxable income US firms are allowed to deduct...

This paper provides a new data set of regional income inequalities within countries based on satellite nighttime light data. We first empirically study the relationship between luminosity data and regional incomes for those countries where regional income data are available. We subsequently use...

I critically review recent studies that estimate those costs of violence and conflict that can emerge among organized political groupings, from states, religious and ethnic organizations to guerillas and paramilitaries. The review includes studies that estimate direct and indirect costs due to...

China’s growth strategy as set out in the 11th 5-year plan in 2005 called for upgrading of product quality, the development of an innovation society, and reduced reliance on foreign intellectual property with high license fees. Consistent with this policy, China has been involved in recent...

This paper explores official trade data to identify patterns of smuggling in international trade. Our main measure of interest is the difference in matched partner trade statistics, i.e., the extent to which the recorded export value in the source country deviates from the reportedimport value...