We develop a unified theory of endogenous business cycles in which expansions are neoclassical growth periods driven by productivity improvements and capital accumulation, while downturns are the result of Keynesian contractions in aggregate demand below potential output. Recessions allow...

Many argue that elements of a society s norms, culture or social capital are central to understanding its development.However, these notions have been difficult to capture in economic models.Here we argue that trustworthiness is the economically relevant component of a society s culture and...

We show how a Schumpeterian process of creative destruction can induce coordination in the timing of entrepreneurial activities across diverse sectors of the economy.Consequently, a multi-sector economy, in which sector-specific, productivity improvements are made by independent, profit-seeking...

We present a theoretical explanation of the gender wage gap which turns on the interaction between men and women in households.In equilibria where men are over-represented in full-time work, we show that firms rationally choose to hire women only at strictly lower wages than men.The model...