Aid is primarily given to governments whereas the engine of sustained growth is the private sector. It is therefore illusory to investigate the impact of aid on growth without considering the impact of government interventions on the private sector. The model shows how these interventions...

This paper analyzes certain policies that are typical of a number of rapidly growing East Asian countries in which a fixed exchange rate, combined with a surplus labor market, has made domestic assets relatively inexpensive, generating high rates of FDI as well as domestic capital formation....

This paper develops a growth model with specialized goods where inefficient and corrupt bureaucracies interact with the provision of public investment services in affecting the productivity of private capital, specialization, and growth. The model provides potential explanations for the...

This paper quantifies the effect of public investment on growth in the ECCU. The results, emerging from panel vector autoregressions, indicate that the return on public investment, as defined by Perreira (2000), is very likely negative. This means that the total change in real output induced by...

We develop an overlapping generations model of a developing economy in which ‘culture’ and technology interact to determine savings, investment and growth. Investment is assumed to involve intermediation or other costs which may, in each period, result in either of two stable equilibria for...

Jappelli and Pagano (1994) argues that tightening the borrowing constraints in the mortgage markets promotes savings. Employing a six-period overlapping generations model with endogenous growth and a method of simulation calibrated on the Middle East, this paper demonstrates that the above...

This paper argues that sub-Saharan Africa’s growth performance needs to be improved substantially in order to raise standards of living to an acceptable level and achieve a visible reduction in poverty. The paper provides a broad overview of the explanations for sub-Saharan Africa’s...

As labor input in Japan shrinks with population aging, capital accumulation and productivity gains will drive growth over the medium-term. At the same time, a changing global landscape calls for a shift in export-oriented investment toward new markets and a new generation of products, as well as...

This paper estimates the impact of public capital on economic growth for forty-eight OECD and non-OECD countries during 1960 - 2001. Using the production function and its extensions, it finds a positive - but concave - elasticity of output with respect to public capital, which is robust to...

Over the past two years, economic activity in Palau has been slowed. Executive Directors welcomed the authorities’ disciplined policies, strong financial sector legislation, and prudent management of foreign grants. They encouraged the authorities to build a strong fiscal consolidation...