This paper analyzes, from a theoretical perspective, the role of the financial system to promote growth and macroeconomic stability. It also endogenously explains the performance of the financial systems as a consequence of industrial (or sectoral) diversification. In the model, the productive...

There is good reason to believe that R&D influences on TFP growth in other sectors are indirect. For R&D to spill over, it must first be successful in the home sector. Indeed, observed spillovers conform better to TFP growth than to R&D in the upstream sectors. Sectoral TFP growth rates are thus...

This paper constructs a model of non-balanced economic growth. The main economic force is the combination of differences in factor proportions and capital deepening. Capital deepening tends to increase the relative output of the sector with a greater capital share, but simultaneously induces a...

Environmental policy affects the distribution of market shares if intermediate goods are differentiated in pollution intensity. When innovations are environmental friendly, a tax on emissions skews demand towards new goods, which are the most productive. In this case along a balanced growth path...

Innovative startups are frequently acquired by large incumbent firms. On the one hand, these acquisitions provide an incentive for startup creation and may transfer ideas to more efficient users. On the other hand, incumbents might acquire startups just to "kill" their ideas, and acquisitions...

Schumpeterian development is characterised by the simultaneous interplay of growth and qualitative transformations of the economic system. At the sectoral level, such qualitative transformations become manifest as variations in the sectoral composition of production. Following the implementation...

The usual models of endogenous growth treat knowledge codification as a byproduct of R&D and as costless. In contrast to this, one can observe great efforts of private firms for the purposeful codification of knowledge. We incorporate costly knowledge codification in an overlapping generations...

In general, empirical studies on economics rely on the assumption of constant capitalshare of income both at the aggregate level and at the sector level. However, there is noempirical evidence supporting the constancy of capital share at the sector level. In thispaper, using Colombian data, we...