Human capital and regional development

We investigate the determinants of regional development using a newly constructed database of 1569 sub-national regions from 110 countries covering 74 percent of the world’s surface and 97 percent of its GDP. We combine the cross-regional analysis of geographic, institutional, cultural, and human capital determinants of regional development with an examination of productivity in several thousand establishments located in these regions. To organize the discussion, we present a new model of regional development that introduces into a standard migration framework elements of both the Lucas (1978) model of the allocation of talent between entrepreneurship and work, and the Lucas (1988) model of human capital externalities. The evidence points to the paramount importance of human capital in accounting for regional differences in development, but also suggests from model estimation and calibration that entrepreneurial inputs and possibly human capital externalities help understand the data.Human Capital, Development, Regional Economics.

Three (Potential) Pillars of Transnational Economic Justice: The Bretton Woods Institutions as Guarantors of Global Equal Treatment and Market Completion

This essay aims to bring two important lines of inquiry and criticism together. It first lays out an institutionally enriched account of what a just world economic order will look like. That account prescribes, via the requisites to that mechanism which most directly instantiate the account, three realms of equal treatment and market completion - the global products, services, and labor markets; the global investment/financial markets; and the global preparticipation opportunity allocation. The essay then suggests how, with minimal if any departure from familiar canons of traditional international legal mandate interpretation, each of the Bretton Woods institutions - particularly the GATT/WTO and the IMF - can be viewed at least in part as charged with the task of fostering equal treatment and ultimate market completion within one of those three realms. The piece then argues that one of the institutions in particular - the World Bank - has, for reasons of at best negligent and at worst willful injustice on the part of influential state actors in the world community, fallen farthest short in pursuit of what should be viewed as its proper mandate. The article accordingly concludes that a fuller empowerment of the Bank to effect its ideal mission will press the Bretton Woods system more nearly into ethical balance, and with it the world into justice; and that full empowerment of the GATT/WTO and IMF should be partly conditioned upon the fuller empowerment of the Bank

Contrarian investment, extrapolation, and risk / 93-128

Contains bibliographical references (p. 26-27)

Investor Protection and Corporate Governance

Recent research has documented large differences among countries in ownership concentration in publicly traded firms, in the breadth and depth of capital markets, in dividend policies, and in the access of firms to external finance. A common element to the explanations of these differences is how well investors, both shareholders and creditors, are protected by law from expropriation by the managers and controlling shareholders of firms. We describe the differences in laws and the effectiveness of their enforcement across countries, discuss the possible origins of these differences, summarize their consequences, and assess potential strategies of corporate governance reform. We argue that the legal approach is a more fruitful way to understand corporate governance and its reform than the conventional distinction between bank-centered and market-centered financial systems.