The idea that income differences between rich and poor nations arise through multiple equilibria or ‘poverty traps’ is as intuitive as it is difficult to verify. In this Paper, we explore the empirical relevance of such models. We calibrate a simple two-sector model for 127 countries, and...

We study barriers to labor mobility using panel data on gross region-to-region migration flows in Russia for 1995-2010. We find that barriers that hindered internal migration in 1990s have been generally eliminated by the end of 2000s. In 1990s many poor Russian regions were in poverty traps:...

What is the right balance among policy interventions in order to ensure economic growth over the long run when an epidemic causes heavy mortality among young adults? We argue that, in general, policies to combat the disease and promote education must be concentrated, in certain ways, on some...

We propose and investigate a new channel through which the resource curse - a stylized fact that countries rich in natural resources grow slower - operates. Predatory governments are more likely to expropriate corporate profits in natural-resource industries when the price of resources is...

This Paper investigates how the legal framework not only affects the amount of external financing available, but also firms’ resource allocation among different types of assets. Using a simple model, we show that in a weaker legal environment a firm will get less financing, and thus invest...

A 2006 survey of 28,000 individuals in 28 post-communist countries reveals overwhelming support for revising privatization, but most respondents prefer to leave firms in private hands. We examine who wants to revise privatization and why. Respondents with poor human capital and few assets...

We develop a property-rights model of the firm in which production entails a continuum of uniquely sequenced stages. In each stage, a final-good producer contracts with a distinct supplier for the procurement of a customized stage-specific component. Our model yields a sharp characterization for...

I provide a justification of intellectual property rights as a source of static efficiency gains in manufacturing, rather than dynamic benefits from greater innovation. I develop a property-rights model of a supply relationship with two dimensions of non- contractible investment. In equilibrium,...

Institutions that serve the interests of an elite are often cited as an important reason for poor economic performance. This paper builds a model of institutions that allocate resources and power to maximize the payoff of an elite, but where any group that exerts sufficient fighting effort can...

We present a general model of the interaction between settlement and the emergence of de facto property rights on frontiers prior to governments establishing and enforcing de jure property rights. Settlers have an incentive to establish de facto property rights to avoid the dissipation...