growth. At early stages of development, the presence of indivisible projects limits the degree of risk …-spreading (diversification) that the economy can achieve. The desire to avoid highly risky investments slows down capital accumulation and the … equilibrium is inefficient because individuals do not take into account their impact on the diversification opportunities of …

We develop an equilibrium search-matching model with risk-neutral agents and two-sided ex-ante heterogeneity … States in terms of unemployment, productivity growth and wage inequality. To show this, we construct two fictitious economies … productivity grows less due to larger mismatch. The model can be used to address a number of normative issues. …

growth model. Its building blocks are financial imperfections and reallocation among firms with heterogeneous productivity …. Some firms use more productive technologies than others, but low-productivity firms survive because of better access to … credit markets. Due to the financial imperfections, high-productivity firms - which are run by entrepreneurs - must be …

population dynamics and productivity growth. Although a reform is necessary, delaying its implementation implies large welfare …

productivity and human capital investments. Using light intensity as an alternative measure for economic activity confirms the …

hinges on risk tolerance and patience. Parents expecting their children to become entrepreneurs have an incentive to instill … entrepreneurs there are in a society hinges, in turn, on parental investments in children's patience and risk tolerance. There can …