This paper tests for the influence of political instability on UK economic growth between 1961 and 1997. We construct six variables that quantify political instability and examine the effect on growth. The results suggest that there is a strong link. GARCH-M models reveal negative effects of...

A simple model of equilibrium unemployment and worker quality is analyzed. Workers accumulate human capital in employment, which depreciates when they are unemployed. For infinitely lived agents, the model is characterized by either continually increasing or decreasing employment and output. For...