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Showing papers in "Research Papers in Economics in 2009"


Posted Content
TL;DR: The Theory of the Growth of the Firm has illuminated and inspired thinking in strategy, entrepreneurship, knowledge creation, and innovation as discussed by the authors, and only a handful in business and management whose insights and ideas last for 50 years and more.
Abstract: There are not many books that are genuine classics, and only a handful in business and management whose insights and ideas last for 50 years and more. This book is one of the very few 'must reads' for anybody seriously interested in the role of management within the firm. Originally published in 1959, The Theory of the Growth of the Firm has illuminated and inspired thinking in strategy, entrepreneurship, knowledge creation, and innovation. Edith Penrose's tightly-argued classic laid the foundations for the resource based view of the firm, now the dominant framework in business strategy. She analyses managerial activities and decisions, organizational routines, and also the factors that inevitably limit a firm's growth prospects. For this new anniversary edition, Christos Pitelis has written a new introduction which both tells the story of Penrose's extraordinary life, and provides a balanced assessment of her key ideas and their continuing relevance and freshness.

7,683 citations


BookDOI
TL;DR: This Time Is Different as mentioned in this paper presents a comprehensive look at the varieties of financial crises, and guides us through eight astonishing centuries of government defaults, banking panics, and inflationary spikes.
Abstract: Throughout history, rich and poor countries alike have been lending, borrowing, crashing--and recovering--their way through an extraordinary range of financial crises. Each time, the experts have chimed, "this time is different"--claiming that the old rules of valuation no longer apply and that the new situation bears little similarity to past disasters. With this breakthrough study, leading economists Carmen Reinhart and Kenneth Rogoff definitively prove them wrong. Covering sixty-six countries across five continents, This Time Is Different presents a comprehensive look at the varieties of financial crises, and guides us through eight astonishing centuries of government defaults, banking panics, and inflationary spikes--from medieval currency debasements to today's subprime catastrophe. Carmen Reinhart and Kenneth Rogoff, leading economists whose work has been influential in the policy debate concerning the current financial crisis, provocatively argue that financial combustions are universal rites of passage for emerging and established market nations. The authors draw important lessons from history to show us how much--or how little--we have learned. Using clear, sharp analysis and comprehensive data, Reinhart and Rogoff document that financial fallouts occur in clusters and strike with surprisingly consistent frequency, duration, and ferocity. They examine the patterns of currency crashes, high and hyperinflation, and government defaults on international and domestic debts--as well as the cycles in housing and equity prices, capital flows, unemployment, and government revenues around these crises. While countries do weather their financial storms, Reinhart and Rogoff prove that short memories make it all too easy for crises to recur. An important book that will affect policy discussions for a long time to come, This Time Is Different exposes centuries of financial missteps.

4,595 citations


Posted Content
TL;DR: The process of innovation must be viewed as a series of changes in a complete system not only of hardware, but also of market environment, production facilities and knowledge, and the social contexts of the innovation organization as discussed by the authors.
Abstract: Models that depict innovation as a smooth, well-behaved linear process badly misspecify the nature and direction of the causal factors at work. Innovation is complex, uncertain, somewhat disorderly, and subject to changes of many sorts. Innovation is also difficult to measure and demands close coordination of adequate technical knowledge and excellent market judgment in order to satisfy economic, technological, and other types of constraints—all simultaneously. The process of innovation must be viewed as a series of changes in a complete system not only of hardware, but also of market environment, production facilities and knowledge, and the social contexts of the innovation organization.

2,154 citations


Posted Content
TL;DR: In this article, a team of world-renowned experts in the methodology of economics cast new light on Friedman's methodological arguments and practices from a variety of perspectives and provide an invaluable assessment of the impact and contemporary significance of Friedman's seminal work.
Abstract: Milton Friedman's 1953 essay 'The methodology of positive economics' remains the most cited, influential, and controversial piece of methodological writing in twentieth-century economics. Since its appearance, the essay has shaped the image of economics as a scientific discipline, both within and outside of the academy. At the same time, there has been an ongoing controversy over the proper interpretation and normative evaluation of the essay. Perceptions have been sharply divided, with some viewing economics as a scientific success thanks to its adherence to Friedman's principles, others taking it as a failure for the same reason. In this book, a team of world-renowned experts in the methodology of economics cast new light on Friedman's methodological arguments and practices from a variety of perspectives. It provides the 21st century reader with an invaluable assessment of the impact and contemporary significance of Friedman's seminal work.

2,151 citations


BookDOI
TL;DR: Conditional cash transfers (CCTs) are programs that transfer cash, generally to poor households, on the condition that those households make pre specified investments in the human capital of their children.
Abstract: Conditional cash transfers (CCTs) are programs that transfer cash, generally to poor households, on the condition that those households make pre specified investments in the human capital of their children. The report shows that there is good evidence that CCTs have improved the lives of poor people. Transfers generally have been well targeted to poor households, have raised consumption levels, and have reduced poverty, by a substantial amount in some countries. Offsetting adjustments that could have blunted the impact of transfers, such as reductions in the labor market participation of beneficiaries, have been relatively modest. The report also considers the rationale for conditioning the transfers on the use of specific health and education services by program beneficiaries. Thus CCTs have increased the likelihood that households will take their children for preventive health checkups, but that has not always led to better child nutritional status; school enrollment rates have increased substantially among program beneficiaries, but there is little evidence of improvements in learning outcomes. These findings suggest that to maximize their potential effects on the accumulation of human capital, CCTs should be combined with other programs to improve the quality of the supply of health and education services, and should provide other supporting services.

2,017 citations


Posted Content
TL;DR: In this article, the authors describe the new generation of discrete choice methods, focusing on the many advances that are made possible by simulation, including the use of the Metropolis-Hastings algorithm and its variant Gibbs sampling.
Abstract: This book describes the new generation of discrete choice methods, focusing on the many advances that are made possible by simulation. Researchers use these statistical methods to examine the choices that consumers, households, firms, and other agents make. Each of the major models is covered: logit, generalized extreme value, or GEV (including nested and cross-nested logits), probit, and mixed logit, plus a variety of specifications that build on these basics. Recent advances in Bayesian procedures are explored, including the use of the Metropolis-Hastings algorithm and its variant Gibbs sampling. This second edition adds chapters on endogeneity and expectation-maximization (EM) algorithms. No other book incorporates all these fields, which have arisen in the past 25 years. The procedures are applicable in many fields, including energy, transportation, environmental studies, health, labor, and marketing.

2,016 citations


Posted Content
TL;DR: The authors found that gender, age, height, and parental background have an economically significant impact on willingness to take risks, and the question about risk taking in general generates the best all-around predictor of risky behavior.
Abstract: This paper studies risk attitudes using a large representative survey and a complementary experiment conducted with a representative subject pool in subjects’ homes. Using a question asking people about their willingness to take risks “in general”, we find that gender, age, height, and parental background have an economically significant impacton willingness to take risks. The experiment confirms the behavioral validity of this measure, using paid lottery choices. Turning to other question about risk attitudes in specific contexts, we find similar results on the determinants of risk attitudes, and also shed light on the deeper question of stability of risk attitudes across contexts. We conduct a horse race of the ability of different measures to explain risky behaviors such as holdings stocks, occupational choice, and smoking. The question about risk taking in general generates the best all-around predictor of risky behavior

1,537 citations


MonographDOI
TL;DR: The second edition of The Economics of Entrepreneurship as discussed by the authors is an essential resource for scholars following the current state of this fast-moving field, covering a broad range of topics in unparalleled depth.
Abstract: This second edition of The Economics of Entrepreneurship is an essential resource for scholars following the current state of this fast-moving field, covering a broad range of topics in unparalleled depth. Designed to be used both as a textbook for specialist degree courses on the economics of entrepreneurship, and as a reference text for academic research in the field, the book draws on theoretical insights and recent empirical findings to show how economics can contribute to our understanding of entrepreneurship. New topics, such as crowdfunding, entrepreneurship education and microenterprise field experiments, appear for the first time, while existing treatments of topics like regional entrepreneurship, innovation and public policy are considerably deepened. Parker also discusses new empirical methods, including quasi-experimental methods and field experiments. Every section - indeed every page - of the new edition has been updated, resulting in a rigorous scientific account of entrepreneurship today.

1,295 citations


Posted Content
TL;DR: This paper showed that a key difference in the approaches is the timing of the news, implying that the VAR shocks are missing the timing and that faulty timing can produce a rise in consumption even when it decreases in the model.
Abstract: Do shocks to government spending raise or lower consumption and real wages? Standard VAR identification approaches show a rise in these variables, whereas the Ramey-Shapiro narrative identification approach finds a fall. I show that a key difference in the approaches is the timing. Both professional forecasts and the narrative approach shocks Granger-cause the VAR shocks, implying that the VAR shocks are missing the timing of the news. Simulations from a standard neoclassical model in which government spending is anticipated by several quarters demonstrate that VARs estimated with faulty timing can produce a rise in consumption even when it decreases in the model. Motivated by the importance of measuring anticipations, I construct two new variables that measure anticipations. The first is based on narrative evidence that is much richer than the Ramey-Shapiro military dates and covers 1939 to 2008. The second is from the Survey of Professional Forecasters, and covers the period 1969 to 2008. All news measures suggest that most components of consumption fall after a positive shock to government spending. The implied government spending multipliers range from 0.6 to 1.1.

1,212 citations


Posted Content
TL;DR: For example, this paper analyzed a national sample of Americans with respect to their debt literacy, financial experiences, and their judgments about the extent of their indebtedness and found that debt literacy is low: only about one-third of the population seems to comprehend interest compounding or the workings of credit cards.
Abstract: We analyze a national sample of Americans with respect to their debt literacy, financial experiences, and their judgments about the extent of their indebtedness. Debt literacy is measured by questions testing knowledge of fundamental concepts related to debt and by selfassessed financial knowledge. Financial experiences are the participants’ reported experiences with traditional borrowing, alternative borrowing, and investing activities. Overindebtedness is a self-reported measure. Overall, we find that debt literacy is low: only about one-third of the population seems to comprehend interest compounding or the workings of credit cards. Even after controlling for demographics, we find a strong relationship between debt literacy and both financial experiences and debt loads. Specifically, individuals with lower levels of debt literacy tend to transact in high-cost manners, incurring higher fees and using high-cost borrowing. In applying our results to credit cards, we estimate that as much as one-third of the charges and fees paid by less knowledgeable individuals can be attributed to ignorance. The less knowledgeable also report that their debt loads are excessive or that they are unable to judge their debt position.

933 citations


Posted Content
TL;DR: In this paper, the authors define what a social business is and describe the first endeavors to create such businesses within the Grameen Group, which in turn leads to a discussion of the social business model.
Abstract: The social business idea borrows some concepts from the capitalist economy, and therefore the implementation of social businesses can likewise borrow some concepts from conventional business literature. As an illustration, the notion of business model, which is currently attracting much attention from researchers, can be revisited so as to enable the building of social businesses. Social business models are needed alongside conventional ones. After defining what a social business is, the authors will describe the first endeavors to create such businesses within the Grameen Group. This in turn will lead to a discussion of the social business model.

Report SeriesDOI
TL;DR: In this paper, the authors present a short discussion of the importance and relevance of 21st century skills and competencies in the current policy debate and the definitions and conceptual frameworks that have been used in the literature, and propose a new three-dimensional framework consisting of the dimensions of information, communication and ethics and social impact.
Abstract: This paper discusses issues related to the teaching and assessment of 21st century skills and competencies in OECD countries drawing on the findings of a questionnaire study and other relevant background material such as white papers or curriculum documents. Although all OECD countries were invited to participate in the questionnaire survey, responses were received from seventeen countries or regions, and the paper focuses primarily on this group. The paper presents a short discussion of the importance and relevance of 21st century skills and competencies in the current policy debate and the definitions and conceptual frameworks that have been used in the literature, and proposes a new three-dimensional framework, consisting of the dimensions of information, communication and ethics and social impact. The findings of the questionnaire survey show that most countries or regions cover 21st century skills and competencies in their regulations, guidelines or recommendations for compulsory education. However, there are few specific definitions of these skills and competencies at national or regional level and virtually no clear formative or summative assessment policies for these skills. The only evaluation regarding their teaching is often left to external inspectors as part of their whole school audits. Similarly there are few teacher training programmes that target the teaching or development of 21st century skills, although there exist several teacher training initiatives that focus on developing teachers’ ICT pedagogical skills, most of them optional. The paper discusses the implications of these findings especially with regard to the particular role of ICT in the development of these skills and competencies, and issues related to assessment practices and teacher training.

Posted Content
TL;DR: This edition of Ronald Miller and Peter Blair's classic textbook is an essential reference for students and scholars in the input-output research and applications community and is also supported by an accompanying website with solutions to all problems, wide-ranging real-world data sets, and appendices for more advanced readers.
Abstract: This edition of Ronald Miller and Peter Blair's classic textbook is an essential reference for students and scholars in the input-output research and applications community. The book has been fully revised and updated to reflect important developments in the field since its original publication. New topics covered include SAMs (and extended input-output models) and their connection to input-output data, structural decomposition analysis (SDA), multiplier decompositions, identifying important coefficients, and international input-output models. A major new feature of this edition is that it is also supported by an accompanying website with solutions to all problems, wide-ranging real-world data sets, and appendices with further information for more advanced readers. Input-Output Analysis is an ideal introduction to the subject for advanced undergraduate and graduate students in a wide variety of fields, including economics, regional science, regional economics, city, regional and urban planning, environmental planning, public policy analysis and public management.

Posted Content
TL;DR: In this paper, the authors estimate the effect of broadband infrastructure, which enables high-speed internet, on economic growth in the panel of OECD countries in 1996-2007, and find that a 10 percentagepoint increase in broadband penetration raises annual per-capita growth by 0.9-1.5 percentage points.
Abstract: We estimate the effect of broadband infrastructure, which enables high-speed internet, on economic growth in the panel of OECD countries in 1996-2007. Our instrumental-variable model derives its non-linear first stage from a logistic diffusion model where pre-existing voice-telephony and cable-TV networks predict maximum broadband penetration. We find that a 10 percentage-point increase in broadband penetration raises annual per-capita growth by 0.9-1.5 percentage points. Results are robust to country and year fixed effects and controlling for linear second-stage effects of our instruments. We verify that our instruments predict broadband penetration but not diffusion of contemporaneous technologies like mobile telephony and computers.

Book ChapterDOI
TL;DR: A review of the literature on national innovation systems can be found in this article, where the authors focus on the emergence of the concept of innovation systems, its historical origins and three main flavors associated to three "founding fathers".
Abstract: We review the literature on national innovation systems. We first focus on the emergence of the concept of innovation systems, reviewing its historical origins and three main flavors (associated to three “founding fathers” of the concept). After this, we discuss how the notion of innovation systems filled a need for providing a broader basis for innovation policy. We conclude with some perspectives on the future of the innovation systems literature.

Posted Content
TL;DR: This paper developed a new framework for examining the distributional consequences of international trade that incorporates firm and worker heterogeneity, search and matching frictions in the labor market, and screening of workers by firms.
Abstract: This paper develops a new framework for examining the distributional consequences of international trade that incorporates firm and worker heterogeneity, search and matching frictions in the labor market, and screening of workers by firms. Larger firms pay higher wages and exporters pay higher wages than non-exporters. The opening of trade enhances wage inequality and raises unemployment, but expected welfare gains are ensured if workers are risk neutral. And while wage inequality is larger in a trade equilibrium than in autarky, reductions of trade impediments can either raise or reduce wage inequality.

Posted Content
TL;DR: This article showed that idiosyncratic firm-level fluctuations can explain an important part of aggregate shocks, and provide a micro-foundation for aggregate productivity shocks, arguing that individual firm shocks average out in aggregate.
Abstract: This paper proposes that idiosyncratic firm-level fluctuations can explain an important part of aggregate shocks, and provide a microfoundation for aggregate productivity shocks. Existing research has focused on using aggregate shocks to explain business cycles, arguing that individual firm shocks average out in aggregate. I show that this argument breaks down if the distribution of firm sizes is fat-tailed, as documented empirically. The idiosyncratic movements of the largest 100 firms in the US appear to explain about one third of variations in output and the Solow residual. This "granular" hypothesis suggests new directions for macroeconomic research, in particular that macroeconomic questions can be clarified by looking at the behavior of large firms. This paper's ideas and analytical results may also be useful to think about the fluctuations of other economic aggregates, such as exports or the trade balance.

Posted Content
TL;DR: The authors found that effort provision is significantly different between treatments in the way predicted by models of expectation-based reference-dependent preferences: if expectations are high, subjects work longer and earn more money than if expectations were low.
Abstract: A key open question for theories of reference-dependent preferences is what determines the reference point. One candidate is expectations: what people expect could affect how they feel about what actually occurs. In a real-effort experiment, we manipulate the rational expectations of subjects and check whether this manipulation influences their effort provision. We find that effort provision is significantly different between treatments in the way predicted by models of expectation-based reference-dependent preferences: if expectations are high, subjects work longer and earn more money than if expectations are low.

Posted Content
TL;DR: In this article, a causal link between the health of banks providing trade finance and growth in a firm's exports relative to its domestic sales is established, suggesting that trade finance accounts for about one-third of the decline in Japanese exports in the financial crises of the 1990s.
Abstract: A striking feature of many financial crises is the collapse of exports relative to output In the 2008 financial crisis, real world exports plunged 17 percent while GDP fell 5 percent This paper examines whether the drying up of trade finance can help explain the large drops in exports relative to output This paper is the first to establish a causal link between the health of banks providing trade finance and growth in a firm’s exports relative to its domestic sales We overcome measurement and endogeneity issues by using a unique data set, covering the Japanese financial crises of the 1990s, which enables us to match exporters with the main bank that provides them with trade finance Our point estimates are economically and statistically significant, suggesting that trade finance accounts for about one-third of the decline in Japanese exports in the financial crises of the 1990s

Posted Content
Abstract: In February 2008, the President of the French Republic, Nicholas Sarkozy, unsatisfied with the present state of statistical information about the economy and the society, asked, Joseph Stiglitz (President of the Commission), Amartya Sen (Advisor) and Jean Paul Fitoussi (Coordinator) to create a Commission, subsequently called "The Commission on the Measurement of Economic Performance and Social Progress" (CMEPSP). The Commission's aim has been to identify the limits of GDP as an indicator of economic performance and social progress, including the problems with its measurement, to consider what additional information might be required for the production of more relevant indicators of social progress, to assess the feasibility of alternative measurement tools, and to discuss how to present the statistical information in an appropriate way (...).

Posted Content
TL;DR: In this article, the authors characterize the evolution over time of a network of credit relations among financial agents as a system of coupled stochastic processes, and investigate the probability of individual defaults as well as the probability for systemic default as a function of the network density.
Abstract: We characterize the evolution over time of a network of credit relations among financial agents as a system of coupled stochastic processes. Each process describes the dynamics of individual financial robustness, while the coupling results from a network of liabilities among agents. The average level of risk diversification of the agents coincides with the density of links in the network. In addition to a process of diffusion of financial distress, we also consider a discrete process of default cascade, due to the re-evaluation of agents' assets. In this framework we investigate the probability of individual defaults as well as the probability of systemic default as a function of the network density. While it is usually thought that diversification of risk always leads to a more stable financial system, in our model a tension emerges between individual risk and systemic risk. As the number of counterparties in the credit network increases beyond a certain value, the default probability, both individual and systemic, starts to increase. This tension originates from the fact that agents are subject to a financial accelerator mechanism. In other words, individual financial fragility feeding back on itself may amplify the effect of an initial shock and lead to a full fledged systemic crisis. The results offer a simple possible explanation for the endogenous emergence of systemic risk in a credit network.

Posted Content
TL;DR: Hulme as discussed by the authors uses different standpoints from science, economics, faith, psychology, communication, sociology, politics and development to explain why we disagree about climate change and shows that climate change, far from being simply an 'issue' or a 'threat', can act as a catalyst to revise our perception of our place in the world.
Abstract: Climate change is not 'a problem' waiting for 'a solution'. It is an environmental, cultural and political phenomenon which is re-shaping the way we think about ourselves, our societies and humanity's place on Earth. Drawing upon twenty-five years of professional work as an international climate change scientist and public commentator, Mike Hulme provides a unique insider's account of the emergence of this phenomenon and the diverse ways in which it is understood. He uses different standpoints from science, economics, faith, psychology, communication, sociology, politics and development to explain why we disagree about climate change. In this way he shows that climate change, far from being simply an 'issue' or a 'threat', can act as a catalyst to revise our perception of our place in the world. Why We Disagree About Climate Change is an important contribution to the ongoing debate over climate change and its likely impact on our lives.

Posted Content
TL;DR: Brand engagement in self-concept (BESC) is a generalized view of brands in relation to the self, with consumers varying in their tendency to include important brands as part of their selfconcepts as discussed by the authors.
Abstract: Brand engagement in self-concept (BESC) is a generalized view of brands in relation to the self, with consumers varying in their tendency to include important brands as part of their self-concepts. The authors develop an eight-item scale to measure BESC and demonstrate that it captures a consumer's general engagement with brands. This scale successfully predicts consumers' differential attention to, memory of, and preference for their favorite brands. Brand engagement in self-concept is also related to differential brand loyalty, with high-BESC consumers being less price and time sensitive regarding their favorite brands than low-BESC consumers. The authors discuss the usefulness of this construct for marketing research.

Posted Content
TL;DR: The copyright in the typographical arrangement rests with the Crown as discussed by the authors, and the material must be acknowledged as Crown copyright and the title of the publication specified, and must be reproduced accurately and not used in a misleading context.
Abstract: Copyright in the typographical arrangement rests with the Crown. This publication, excluding logos, may be reproduced free of charge in any format or medium for research, private study or for internal circulation within an organisation. This is subject to it being reproduced accurately and not used in a misleading context. The material must be acknowledged as Crown copyright and the title of the publication specified.

Posted Content
TL;DR: In this paper, the main economic and political determinants of the state's capacity to raise revenue and support private markets are investigated, and a simple model is formulated to analyze the determinants in the first section and modified to address new issues that arise in subsequent sections.
Abstract: We report on an on-going project, which asks a number of questions relevant to the study of state capacity. What are the main economic and political determinants of the state’s capacity to raise revenue and support private markets? How do risks of violent conflict affect the incentives to invest in state building? Does it matter whether conflicts are external or internal to the state? When are large states associated with higher income levels and growth rates than small states? What relations should we expect between resource rents, civil wars and economic development? The paper is organized into three main sections: 1. The origins of state capacity, 2. Sate capacity and the genius of taxation, and 3. State capacity and the strategy of conflict. Each of these begins with a specific motivation. A simple model is formulated to analyze the determinants of state capacity in the first section, and modified to address the new issues that arise in subsequent sections. The theoretical results are summarized in a number of propositions. We discuss the implications of the theory, comment on its relation to existing literature, and briefly mention some empiric applications.

Posted Content
TL;DR: In this article, the authors quantify the effects of credit externality in a two-sector DSGE model of a small open economy calibrated to emerging markets, and show that the credit externalality causes a modest increase in average debt, of about 2 percentage points of GDP, but it triples the probability of financial crises and doubles the average current account and consumption reversals caused by these crises.
Abstract: Credit constraints that link a private agent's debt to market-determined prices embody a systemic credit externality that drives a wedge between competitive and (constrained) socially optimal equilibria, which induces private agents to ``overborrow". We quantify the effects of this externality in a two-sector DSGE model of a small open economy calibrated to emerging markets. Debt is denominated in units of tradable goods, and is constrained not to exceed a fraction of income, including nontradables income valued at the relative price of nontradables. The externality arises because agents fail to internalize the price effects of their individual borrowing, and hence the adverse debt-deflation amplification effects of negative income shocks that trigger a binding credit constraint. Quantitatively, the credit externality causes a modest increase in average debt, of about 2 percentage points of GDP, but it triples the probability of financial crises and doubles the average current account and consumption reversals caused by these crises.

Posted Content
TL;DR: The Economics of Growth as mentioned in this paper is a comprehensive introduction to economic growth, presenting the main facts and puzzles about growth, proposes simple methods and models needed to explain these facts, acquaints the reader with the most recent theoretical and empirical developments, and provides tools with which to analyze policy design.
Abstract: This comprehensive introduction to economic growth presents the main facts and puzzles about growth, proposes simple methods and models needed to explain these facts, acquaints the reader with the most recent theoretical and empirical developments, and provides tools with which to analyze policy design. The treatment of growth theory is fully accessible to students with a background no more advanced than elementary calculus and probability theory; the reader need not master all the subtleties of dynamic programming and stochastic processes to learn what is essential about such issues as cross-country convergence, the effects of financial development on growth, and the consequences of globalization. The book, which grew out of courses taught by the authors at Harvard and Brown universities, can be used both by advanced undergraduate and graduate students, and as a reference for professional economists in government or international financial organizations. The Economics of Growth first presents the main growth paradigms: the neoclassical model, the AK model, Romer's product variety model, and the Schumpeterian model. The text then builds on the main paradigms to shed light on the dynamic process of growth and development, discussing such topics as club convergence, directed technical change, the transition from Malthusian stagnation to sustained growth, general purpose technologies, and the recent debate over institutions versus human capital as the primary factor in cross-country income differences. Finally, the book focuses on growth policies—analyzing the effects of liberalizing market competition and entry, education policy, trade liberalization, environmental and resource constraints, and stabilization policy—and the methodology of growth policy design. All chapters include literature reviews and problem sets. An appendix covers basic concepts of econometrics.

Posted Content
TL;DR: In this paper, stylized facts about firms' export prices using detailed customs data on the universe of Chinese trade flows are established, showing that exporters that charge higher prices earn greater revenues in each destination, have bigger worldwide sales, and enter more markets.
Abstract: This paper establishes six stylized facts about firms' export prices using detailed customs data on the universe of Chinese trade flows. First, across firms selling a given product, exporters that charge higher prices earn greater revenues in each destination, have bigger worldwide sales, and enter more markets. Second, firms that export more, that enter more markets and that charge higher export prices import more expensive inputs. Third, across destinations within a firm-product, firms set higher prices in richer, larger, bilaterally more distant and overall less remote countries. Fourth, across destinations within a firm-product, firms earn bigger revenues in markets where they set higher prices. Fifth, across firms within a product, exporters with more destinations offer a wider range of export prices. Finally, firms that export more, that enter more markets and that offer a wider range of export prices pay a wider range of input prices and source inputs from more origin countries. We propose that trade models should incorporate two features to rationalize these patterns in the data: more successful exporters use higher-quality inputs to produce higher-quality goods (stylized facts 1 and 2), and firms vary the quality of their products across destinations by using inputs of different quality levels (stylized facts 3, 4, 5 and 6).

Posted Content
TL;DR: This working paper is the first draft of an overview and commentary on the papers to appear in a Macroeconomic Dynamics Special Issue on Measurement with Theory, which is part of a larger initiative to promote "measurement with theory" in economics.
Abstract: This paper is the introduction to the forthcoming Macroeconomic Dynamics Special Issue on Measurement with Theory. The Guest Editors of the special issue are William A. Barnett, W. Erwin Diewert, Shigeru Iwata, and Arnold Zellner. The authors of this detailed introduction and commentary are William A. Barnett, W. Erwin Diewert, and Arnold Zellner. The included papers are part of a larger initiative to promote measurement with theory in economics.

Posted Content
TL;DR: In this paper, the authors propose a specifi city of management of luxury brands, where one needs to distinguish it strongly from both fashion and premium or " trading up", and set out some of the counter-intuitive rules for successfully marketing luxury goods and services.
Abstract: Today luxury is everywhere. Everybody wants his products to be luxury. The concept of luxury is attractive and fashionable. There are luxury columns in all magazines and journals. There are TV shows on the business of luxury, and on luxury products and services. Even mass-consumption brands name many of their models " Deluxe" or qualify their experience as luxurious. New words have been recently invented and promoted that add to the complexity: masstige, opuluxe, premium, ultra-premium, trading up, hyperluxury, real or true luxury, and so on. There is a confusion today about what really makes a luxury product, a luxury brand or a luxury company. Managing implies clear concepts and, beyond these concepts, clear business approaches and pragmatic rules. The aim of this paper is to unveil the specifi city of management of luxury brands. Going back to fundamentals, one needs to distinguish it strongly from both fashion and premium or " trading up ". From this starting point, it sets out some of the counter-intuitive rules for successfully marketing luxury goods and services.