This contribution is motivated by two stylized observations, the slowdown in growth, and a simultaneous income polarization in many advanced economies. While mainstream neoclassical and endogenous growth theory cannot sufficiently explain the nexus, we argue that the demand side plays a role. We...

A stylized fact of economic development is the structural transformation of countries from traditional, mainly agricultural societies to modern economies dominated by manufacturing and services. In this paper we provide an endogenous growth model to illuminate the role of entrepreneurial...