The German system of codetermination contributes to the entrenchment of labor. We show in a two-period model of project choice that entrenched labor leads to underinvestment and overstaffing. We provide empirical evidence that German firms subject to codetermination with equal representation of...

Statistics on the size and growth of the U.S. federal government, along with the rhetoric of President Franklin Roosevelt, seem to indicate that the Great Depression was the event that started the dramatic growth in government spending and intervention in the private sector that has continued to...

This is the first of two articles on the dynamics of the Jamaican economy over the last two and a half decades. It compares the overall macroeconomy of Jamaica in the areas of output, fiscal and monetary policy, capital formation and trade to that of Singapore and South Korea. The conclusion...

In this paper we investigate the relation between the quality of institutions and macroeconomic volatility. Using instrumental variable regressions, we show that higher barriers to entry lead to higher volatility. In particular, a one standard deviation increase in entry costs increases the...

Presentation before the Conference on Striking the Right Notes on Entrepreneurship, Memphis, Tenn., April 19, 2005

Memphis, Tenn., Oct. 14, 2008

This paper draws on the experiences of the United States and European Community to speculate on the effects of agreements to integrate high and low income economies. The evidence suggests that reducing barriers to the flow of goods or resources will promote convergence, even among integrating...

We study a model of economic growth and development with a threshold externality. The model has one steady state with a low and stagnant level of income per capita and another steady state with a high and growing level of income per capita. Both of these steady states are locally stable under...

The role of the financial sector in stimulating economic growth has been debated in the economic profession for decades. The prevailing view is that financial intermediaries reduce the transactions costs of channeling funds from savers to entrepreneurs by reducing information asymmetries between...

Presentation to the Southern Illinois University at Edwardsville, Third Annual Rutman Lecture, Edwardsville, Ill., April 10, 2003