In a simultaneous equations with error components framework, we analyze the institutions-growth relationship. We … the direct and indirect effects of institutions on growth. We find that the effects of political freedom on total factor … force growth. Economic freedom, on the other hand, has positive and significant effects on total factor productivity …

This paper formulates a model of dynamic, endogenous reform of political institutions. Specifically, a class of dynamic … future political institutions are decided under current ones. The process is instrumental because institutional choices do …

Recent economic growth theory has suggested that wealth differences across nations must be due, at least in part, to …

This paper presents a simple Cass-Koopmans-Ramsey AK growth model with heterogeneity that explains how policies that … increase income inequality may temporarily boost a country’s income growth rate. Briefly put, a change in policy that reduces … redistributive transfers will free up resources to the households with the highest productivities, resulting in an aggregate growth …

The relationship between income distribution and economic growth has been found to depend on several factors such as … trade and openness. The current work assesses how income inequality influences growth stimating a reduced form growth … household income from national surveys, it is found that inequality and growth are positively related. When analysing different …

welfare gain from eliminating business cycles can exceed the gain from increasing the long-term growth rate by 1% forever. Our …