How rich would resource-abundant countries be if they had actually followed the Hartwick Rule (invest resource rents in other assets) over the past 30 years? The authors use time series data on investments and rents onexhaustible resource extraction for 70 countries to answer this question. The...

The author presents theory and calculations to show that part of the explanation of slow growth in many poor countries is not that governments did not spend on investment, but that these investments did not create productive capital. For a variety of reasons governments take resources from...

The author provides a selective review of the recent analytical and empirical literature on the benefits and costs of international financial integration. He discusses the impact of financial openness on consumption, investment, and growth, and the impact of foreign bank entry on the domestic...

Mexico's economic crisis in December 1994 gave renewed importance to the issue of"spillover"or"contagion"effects in other emerging market economies (and their sensitivity to events in larger countries in the region.) They focus on how small open economies are affected by their neighbors'ecomomic...

After being excluded from world capital markets during the debt crisis, many developing countries have experienced large capital inflows in the past five years. The challenges these inflows pose for domestice policy have generated a substantial literature. The authors review and extend that...

The authors combine the agency theory of the firm with risk diversification incentives for insiders. Principal-agent problems between insiders and outsiders force insiders to retain a larger share in their firm than they would under a perfect risk diversification strategy. The authors predict...

Using panel data for a cross-section of countries, the author estimates an aggregate production function that includes infrastructure capital. He finds that: 1) The productivity of physical and human capital is close to the levels suggested by microeconomic evidence on their private returns. 2)...

A recent but rapidly growing empirical literature focuses on the relationship between public and private capital. But for the most part, it ignores the heterogeneity of public investment. In many countries, especially in the developing world, public investment includes not only basic...

During the past two decades there has been an important increase in investment abroad and a worldwide rush toward free trade. The author argues that the increase in investment abroad may partially explain the worldwide rush toward free trade. In a model of endogenous determination of trade...

It has been widely recognized that both country-specific and global factors matter in explaining capital flows. The author presents an empirical framework that disentangles the relative weight of country-specific and global factors in determining capital flows. In essence, his approach first...