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We use a two-sector model of structural transformation and balanced growth to show that the real interest rate, measured as the return on capital in units of GDP or in units of aggregate consumption, declines as income grows. This is due to the differential TFP growth in the goods producing...
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performance of hedge funds both in the cross-section and over time. We measure uncertainty about volatility of the market …-taking incentives arising from performance-based compensation of hedge funds. …
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