This paper, using a cumulative growth model and a catch-up model, verifies the cumulative relationship between IT investment and economic growth, and then examines whether this relationship enlarges the differences in the economic growth among OECD countries. We observe the following results:...

Despite the fast catching-up in ICT diffusion experienced by most EU countries in the last few years, information technologies have so far delivered little productivity gains in Europe. In the second half of the past decade, growth contributions from ICT capital rose in six EU countries only...

In many OECD countries income inequality has risen, but surprisingly redistribution has as well. The theory attributes this partly to the redistributive effect of education spending. In the model income inequality and growth depend in an inverted U-shaped way on education. To maintain a given...

This paper reviews the obstacles for an appropriate financial architecture of new economy firms in developing countries by reviewing the theoretical and some preliminary empirical underpinnings of the importance of legal and institutional barriers. Apart from the more conventional institutional...

Success of the debt-relief HIPC and poverty-reduction PRSP initiatives demands annual growth rates of 5 percent sustained for fifteen years in Honduras. However, existing evidence on the impact of AIDS on economic growth in Africa raises concern on the viability of such growth targets in...

All of the recent empirical work on the relationship between income inequality and economic growth has used inequality data that are not consistently measured. This paper argues that this is inappropriate and shows that the significant negative correlation often found between income inequality...

The micro-macro paradox has been revived. Despite broadly positive evaluations at the micro and meso-levels, recent literature has turned decidedly pessimistic with respect to the ability of foreign aid to foster economic growth. Policy implications, such as the complete cessation of aid to...

The contribution of the ‘new economy’ to economic growth in developing countries has so far been minimal. Despite the recent hype, the ‘old economy’ will for long be the fundamental force behind economic growth in transition economies. Nonetheless, in the longer run the ‘new economy’...

Past breakthroughs in communication technology—the invention of the printing press and the telegraph—led to major economic upheavals. What are the implications of the more recent information and communication technologies (ICTs) for the developing world? Optimists believe that modern ICTs...