The role of improved schooling, a central part of most development strategies, has become controversial because expansion of school attainment has not guaranteed improved economic conditions. This paper reviews the role of education in promoting economic wellbeing, with a particular focus on the...

We use an excludable instrument to test the effect of bilateral foreign aid on economic growth in a sample of 96 recipient countries over the 1974-2009 period. We interact donor government fractionalization with a recipient country's probability of receiving aid. The results show that...

Estimations of the size and development of the shadow economy for 145 countries, including developing, transition and highly developed OECD economies over the period 1999 to 2003 are presented. The average size of the shadow economy (as a percent of "official" GDP) in 2002/03 in 96 developing...

In this paper we determine the main driving forces underlying the structural transformation and urbanization process in rapidly industrializing countries. We use a dynamic, small open economy model with an abundant supply of surplus labor in rural areas, two types of traded goods manufactured in...

While the short-term growth consequences of natural disasters are comparatively well studied, there is little knowledge how disasters affect long-run growth. Based on truly exogenous storm indicators, derived from a meteorological database, we show that the growth effects of tropical storms go...