In middle-income countries, the informal sector often accountes for a substantial fraction of the urban labour force. We develop a general equilibrium model with matching frictions in the urban labour market, the possibility of self-employment in the informal sector, and scope for rural-urban...

This paper argues that dual economy models deserve a central place in the analysis of growth in developing countries. The paper shows how these models can be used to analyse the output losses associated with factor misallocation, aggregate growth in the presence of factor market distortions,...

This paper addresses recent explanations for the East Asian miracle. The argument that growth is entirely due to the accumulation of inputs is assessed and found wanting. There is still a place for the view that attributes success to activist policy. This is especially so, since the other...

This paper examines whether growth regressions should incorporate dualism and structural change. If there is a differential across sectors in the marginal product of labour, changes in the structure of employment can raise aggregate total factor productivity. The paper develops empirical growth...

A recent paper by Jesus Felipe and John McCombie argues that I have understated the importance of the value added identity for conventional estimates of production relationships. This reply seeks to clarify the areas of agreement and disagreement. It suggests that the problems raised by the...

Observable variables capturing initial conditions can account for well over half of the variation in developing country growth rates. This paper investigates their role in explaining Africa's recent economic history. Should the origins of slow growth be traced to Africa's social arrangements,...

The issue of model uncertainty is central to the empirical study of economic growth. Many recent papers use Bayesian Model Averaging to address model uncertainty, but Ciccone and Jarociński (2010) have questioned the approach on theoretical and empirical grounds. They argue that a standard...

The issue of model uncertainty is central to the empirical study of economic growth. Many recent papers use Bayesian Model Averaging to address model uncertainty, but Ciccone and Jarocinski (2010) have questioned the approach on theoretical and empirical grounds. They argue that a standard...