We ask which part of the observed cross-country differences in the level of per capita income can be accounted for by monopoly rights in the labour market.We answer this question in a calibrated growth model with two final goods sectors.The novel feature being that monopoly rights in the...

How does trade policy a affect technology adoption, total factor productivity (TFP henceforth), and per capita income? To study this question we construct a dynamic general equilibrium model of a small open economy in which a coalition of skilled workers chooses the technology. We obtain three...

Most real-world trade liberalizations decrease tariffs and increase quotas without completely abolishing them. We ask how decreases in tariffs and increases in quotas affect productivity in an economy with monopoly rights in the import-competing sector. We show that a reduction in a tariff can...

We ask for which part of the observed cross-country differences in the level of per-capita income monopoly rights can account. We answer this question in a calibrated growth model with capital. Monopoly rights in the capital-producing sector shield labor market insiders from the competition by...

Standard models of economic development typically ignore geography and transport. In this paper, we argue that we should model the transport sector, as it plays a quantitatively important role.\\ To understand what will determine the importance of the transport sector, consider the transport...

We ask whether barriers to entry are a quantitatively important reason for the income gap between developing countries and the U.S. We develop a tractable general equilibrium model that captures the effects of barriers to entry and the other main classes of distortion typically considered in the...

We study the effects of large transportation costs on economic development. We argue that the Midwest and the Northeast of the U.S. is a natural case because starting from 1840 decent data is available showing that the two regions shared key characteristics with today’s developing countries...

We ask how barriers to international trade affect TFP when there are monopoly rights in the import--competing industries. Holmes and Schmitz (1995) show that without barriers to trade TFP in these industries is as large as possible. We study the general case of finite barriers to trade. We find...

We ask which part of the observed cross-country differences in the level of per capita income can be accounted for by monopoly rights in the labour market. We answer this question in a calibrated growth model with two final goods sectors. The novel feature being that monopoly rights in the...