Standard models of intertemporal utility maximization under uncertainty assume that agents discount future utility flows at a constant compounded rate—exponential discounting. Euler equations estimated over different time horizons should have equal discount rates. They do not. Rising term...

The hallmark of the recent development and growth literature is the quest to identify institutions that explain significant portions of the observed differences in living standards. There are two drawbacks to the prominent approaches that focus either on the global sample, or on developing...