Intro -- Contents -- I. INTRODUCTION -- II. BASIC FRAMEWORK -- III. BASELINE CALIBRATIONS -- IV. DOMESTIC ADDITIONAL EFFORT, POVERTY TRAPS, AND "TAKEOFF" -- V. EXTENSIONS -- VI. CONCLUDING REMARKS -- REFERENCES.

We study the relative efficiency of outside-owned versus employee-owned firms and analyze implications for institutional change in a context of technological innovation. When decisions are made through majority voting, the vote on technology choice is used to influence the later vote on the...