We estimate the respective contributions of institutions, geography, and trade in determining income levels around the world, using recently developed instrumental variables for institutions and trade. Our results indicate that the quality of institutions "trumps" everything else. Once...

When local cost discovery generates knowledge spillovers, specialization patterns become partly indeterminate and the mix of goods that a country produces may have important implications for economic growth. We demonstrate this proposition formally and adduce some empirical support for it. We...

This article argues that domestic social conflicts are a key to understanding why growth rates lack persistence and why so many countries have experienced a growth collapse since the mid-1970s. It emphasizes, in particular, the manner in which social conflicts interact with external shock on the...