This note describes a simple procedure for solving the risky steady state in medium-scale macroeconomic models. This is the “point where agents choose to stay at a given date if they expect future risk and if the realization of shocks is 0 at this date” [Coeurdacier, N., Rey, H., Winant, P.,...

We examine the (potentially nonlinear) relationship between inequality and growth using a method which does not require an a priori assumption on the underlying functional form. This approach reveals a plateau completely missed by commonly used (nonlinear) parametric approaches—the economy...

This paper studies whether bank competition affects growth of non-banking industries. We find that non-cooperative bank competition and stability promote industrial growth robustly. Bank concentration may also affect growth positively; the latter effect increases for higher levels of competition.

We find that an expansion of credit has a positive effect on per capita output growth only up to a point. Beyond this threshold the impact of finance on growth is not statistically significant anymore. We show, however, that the estimated non-linear relationship may stem from the omission of...

We show that financial development has a non-monotonic effect on growth in the Rajan and Zingales (1998) and Fisman and Love (2007) sample. Beyond a threshold, financially dependent industries and industries facing good growth opportunities grow disproportionately more slowly.

Three components govern the impact of intangible management on the growth of SMEs: human, structural and relational capitals. The relationship with the institutional system of innovation (ISI) is novel. The results highlight that the ISI does not satisfy the needs of SMEs fully.

This paper shows that the effect of vocational education on economic growth appears to be greater than that of university education. Additionally, the reversed effect of economic growth on vocational education seems to be stronger than on university education.

Using US manufacturing industry data, we re-examine evidence of first- and second-generation models of R&D-based endogenous growth focusing on innovation (patent) quality. We show that Schumpeterian growth theories perform better than semi-endogenous growth models.

We reexamine the association between poverty, the middle class, and institutional outcomes using a newly developed cross-country panel dataset containing detailed information on the distribution of income and expenditure. When the size of the middle class increases (measured as the proportion of...

This paper highlights a new fact about structural change by focusing on the dynamics of the capital income share at the sectoral level. That is, the capital income share in services decreases steadily while that in the manufacturing sector increases over time. I develop a two-sector growth model...