We present cross-country empirical evidence on the role of natural resources in explaining long-run differences in private investment as a share of GDP in a sample of 72 developing countries.  Our empirical results suggest important differences between oil and non-oil resources.  While revenue...

This paper extends the model of Fielding (1999), which is designed to explain changes in investment in South Africa during the Apartheid period, by allowing a role for indicators of political instability and political and civil rights, as measured by Fedderke et al. (1999). The conclusions based...

We present evidence that an increase in investment as a share of GDP predicts a higher growth rate of output per worker, not only temporarily, but also in the steady state. These results are found using pooled annual data for a large panel of countries, using pooled data for non-overlapping...

This paper examines an open economy model in which equilibrium unemployment depends on capacity in the traded-goods sector. The model is estimated using U.K. quarterly data and compared with alternative concepts of equilibrium unemployment based on labour market variables (as in Layard and...

The principles of how best to manage the various components of national wealth are outlined, where the permanent income hypothesis, the Hotelling rule and the Hartwick rule play a prominent role. As far as managing natural resource wealth is concerned, a case is made to use an intergenerational...

Much recent monetary policy literature has searched for structural models suitable for policy analysis that are both based on optimising microfoundations and consistent with the data, especially observed persistence in inflation and output. Few models do well on both criteria. We derive an...

During the Bretton Woods era, OECD countries grew at historically unprecedented rates. This Golden Age has many possible explanations, ranging from the return to liberal policies in international trade to a backlog of profitable growth opportunities after the neglect of the 1930s and war-time...

By assuming Cobb-Douglas production technology, many well-known imperfectly competitive macroeconomic models of the labour market (e.g. Layard, Nickell and Jackman, 1991) imply that equilibrium unemployment is independent of the capital stock. This paper introduces a new notion of capacity into...

Optimal monetary policy is sensitive to the Phillips curve specification used to represent the dynamics of inflation and output. Most recent literature has used a new Keynesian Phillips Curve based on Calvo pricing. This paper shows that this workhorse model is not robust to relatively minor...

We analyze the microfoundations of the Phillips curve and the close links between that relationship and results concerning optimal monetary policy, stabilisation bias and monetary policy delegation. Most recent literature has used a New Keynesian Phillips Curve based on Calvo pricing, often with...