In this article, we make three contributions: i) wealth is the correct linear indicator of welfare (defined as the present value of future utilities) if population is constant, ii) there is no need to make assumption of an optimal economy and by using the abstract notion of a resource allocation mechanism, it is possible to develop intertemporal welfare economics in imperfect economies, iii) wi...

We develop a methodology to analyze capital misallocation (dispersion in static marginal products) measure the contributions of technological/informational frictions and a rich class of firm-specific factors. An application to Chinese manufacturing firms reveals that adjustment costs and uncertainty, while significant, generate only a modest amount of MPK dispersion, which stems largely from ot...

We reevaluate the role of human capital in determining the wealth of nations. We use standard human capital theory to estimate stocks of human capital and allow the quality of human capital to vary across countries. Our model can explain differences in schooling and earnings profiles and, consequently, estimates of Mincerian rates of return across countries. We find that effective human capital...

Failure to separate unexpected capital gains and losses on natural assets from depletion breaks the link between Net National Product (NNP) and sustainability. In addition, for resource rich countries this can lead to large spurious fluctuations in NNP, making it virtually useless for policy purposes. In contrast, when depletion is measured correctly, the link between NNP and sustainability is ...

We consider a stochastic environment to study interactions among pollution growth, demographic changes, and economic growth. Drawing on the empirical findings of slow convergence patterns of pollution shocks (viz., with a long-memory), we build an analytical framework where stochastic environmental feedback effects on population changes are reflected upon aggregate economic growth. Long-memory ...

Public Infrastructure as a Determinant of Intertemporal and Interregional Productive Performance in China This paper focuses on the question whether public infrastructure capital matters for labor productivity in China, both over time and across regions. It finds that public infrastructure is a significant determinant of variations in labor productivity across provinces, but the contribution of...

This paper investigates the relationship between telecommunications infrastructure competition, investment and productivity. Using econometric modelling and input-output economics, the analysis examines and measures the extent to which telecommunications has contributed to national and sectoral productivity performance. The main findings from this paper suggests that most industries have benefi...

Foreign direct investment (FDI) has dramatically increased worldwide and is the most important form of all private capital flows to developing countries. Yet, it is an important empirical question whether FDI affects total factor productivity (TFP) positively. We investigate the effect of FDI on TFP growth in a large sample of countries in 1970–2000. Our econometric results indicate that FDI ha...