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Long-Run Policy Analysis and Long-Run Growth

Sergio Rebelo

Finance

Journal of Political Economy 1991

The wide cross-country disparity in rates of economic growth is the most puzzling feature of the development process. This paper describes a class of models in which this heterogeneity in growth experiences can be the result of cross-country differences in government policy. These differences can also create incentives for labor migration from slow-growing to fast-growing countries. In the models considered, growth is endogenous, despite the absence of increasing returns, because there is a "core" of capital goods that can be produced without the direct or indirect contribution of factors that cannot be accumulated, such as land. Copyright 1991 by University of Chicago Press.

DOI
10.1086/261764
Volume
99 (3)
Pages
500-521
Language
en
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