One critical aspect of economic development is that productivity growth and a rising standard of living are realized through more roundabout methods of production and increasing specialization of intermediate inputs and producer services. We use an extended version of the Judd-Grossman-Helpman...

We develop a microeconomic model of endogenous growth where clean and dirty technologies compete in production and innovation—in the sense that research can be directed to either clean or dirty technologies. If dirty technologies are more advanced to start with, the potential transition to...

This paper examines whether the Solow growth model is consistent with the international variation in the standard of living. It shows that an augmented Solow model that includes accumulation of human as well as physical capital provides an excellent description of the cross-country data. The...

We provide an overview of recent empirical research on patterns of cross-country growth. The new empirical regularities considered differ from earlier ones, e.g., the well-known Kaldor stylized facts. The new research no longer makes production function accounting a central part of the analysis....

We develop a model of repeated product improvements in a continuum of sectors. Each product follows a stochastic progression up a quality ladder. Progress is not uniform across sectors, so an equilibrium distribution of qualities evolves over time. But the rate of aggregate growth is constant....

We construct a rational expectations model in which aggregate growth alternates between a low growth and a high growth state. When all agents expect growth to be slow, the returns on investment are low, and little investment takes place. This slows growth and confirms the prediction that the...

This paper explores the five simplest models of endogenous growth. We start with the AK model (Rebelo (1990)) and argue that all endogenous growth models can be viewed as variations or microfoundations of it. We then examine the Barro (1990) model of government spending and growth. Next we look...