Constant returns to scale is a central construct of neoclassical theory. Previous studies argued that one must adopt a specification of the production function with substantial unobserved service variation to reconcile constant returns with the data. Some economists have argued that this finding...

The high real wage story is one of the leading hypotheses for how deflation caused the International Great Depression. The story is that world-wide deflation, combined with incomplete nominal wage adjustment, raised real wages in a number of countries, and these higher real wages reduced...

Latin American countries are the only Western countries that are poor and that aren't gaining ground on the United States. This article evaluates why Latin America has not replicated Western economic success. We find that this failure is primarily due to total factor productivity (TFP)...

The UK was depressed for 20 years between the two World Wars. The decrease in output was entirely due to lower hours per worker and lower employment. Our main finding is that generous unemployment benefits, in conjunction with large negative sectoral shocks, is the most plausible candidate...