The Politicization of Growth Theory

In this essay I review the main features of neoclassical growth theory, with an eye to seeing what it has to say about the causes of wealth and poverty among nations. I argue that outside the OECD and a comparatively small circle of other countries, neoclassical models contribute little to identifying the deeper sources of cross-national patterns in growth and productivity. I then discuss recent advances in the empirical analysis of economic performance that feature the influence of politics, policy and institutional arrangements on entrepreneurship, innovation, investment and the efficiency with which factor inputs are transformed to output.neoclasssical growth theory; institutions and economic development and growth; politics and economic development and growth

Building Jefferson\u27s future

2002 Annual report of Thomas Jefferson University

Biogeography and Long-Run Economic Development

The transition from a hunter-gather economy to agricultural production, which made possible the endogenous technological progress that ultimately led to the industrial revolution, is one of the most important events in the thousands of years of humankind’s economic development. In this paper we present theory and evidence showing that exogenous geography and initial condition biogeography exerted decisive influence on the location and timing of transitions to sedentary agriculture, to complex social organization and, eventually, to modern industrial production. Evidence from a large cross-section of countries indicates that the effects of geographic and biogeographic endowments on contemporary levels of economic development are remarkably strong.Geography biogeography and growth; Economic development; Agricultural revolution; Institutions and growth; Plants animals and growth

Tax Toleration and Tax Compliance: How Government Affects the Propensity of Firms to Enter the Unofficial Economy

We propose a model of how government-supplied institutional benefits and the taxation and regulation of producers affect the propensity of private firms to enter the unofficial economy and evade taxation. Our analysis implies that the incentive of firms to produce underground depends on tax rates relative to firmspecific thresholds of tax toleration that are decisively affected by quality of governance — in particular by the presence of high-grade institutions delivering services that profit-maximizing firms deem worth paying for. Some key predictions of the model concerning the determinants of firms’ tax toleration and tax compliance receive broad support from empirical analyses of enterprise-level data from the World Bank’s World Business Environment Surveys.-

Diversification and the Taxation of Capital Gains and Losses

Current U.S. law nets the total portfolio of realized capital gains and losses to compute capital gains taxes. Prior research, however, typically ignores the implication of this provision, i.e., the marginal tax rate for a specific gain or loss depends on the taxpayer's total portfolio of realized gains and losses. We find that these nettings introduce complexity into the relation between share values and capital gains taxes, creating an incentive to diversify. For firms with stock returns that are positively (negatively) correlated with those of the overall market, share values generally are decreasing (increasing) in the capital gains tax rate.

The Popular Reaction to German Drama in England at the End of the Eighteenth Century

Paper by Douglas Milburn, Jr