This paper develops a model to assess the quantitative effect of entry cost and financial friction on cross-country income and total factor productivity (TFP) differences. The main focus is on the interaction between entry cost and financial friction. The model is calibrated to match establishment-level statistics for the U.S. economy assuming a perfect financial market. The quantitative analys...

We study the mechanisms according to which social infrastructure influences the preservation of physical capital and, consequently, economic growth. The presented model considers that social infrastructure is a specific type of human capital, which acts in order to preserve already existing physical capital, by, e.g. reducing the incentive for rent seeking or corruption. Using an innovative met...

Evidence supporting the positive effects of capital account liberalization on growth is mixed at best. Even after conditioning on the quality of domestic financial institutions, a significant number of studies still find no effect. One possible explanation is reverse causation. If low growth countries liberalize in order to spur growth, the observed correlation between growth and liberalization...

Numerous economic historians have suggested that institutions which supported contract enforcement were necessary for impersonal exchange to emerge in medieval Europe. Yet this literature cannot account for the bill of exchange, an important financial instrument that was legally enforced in both the medieval Islamic and Christian worlds but remained relegated to personal networks in only the fo...

In recent years, academic economists have come to appreciate the centrality of public institutions in contributing to economic performance. Yet Korea, arguably the premier success story of the last half-century, has sometimes been described as a First World economy with Third World institutions. Although Korea modestly underachieves on most of the 52 institutional indicators examined in this pa...

In this paper, I consider a specific channel through which trust between parties to an exchange can go on to affect nations’ comparative advantage in certain industries. My approach revolves around the autonomy that employers (principals) grant to workers (agents), which is a key feature of workplace organization. I hypothesize that social trust generates a comparative advantage in industries w...

The poverty reduction and financial inclusion of Sustainable Development Goals (SDG) by 2030 can be significantly facilitated the microfinance industry. However, it is pertinent to assess sustainability institutions (MFIs) in serving this purpose. estimation productivity MFIs Bangladesh gives a glimpse their ability fulfil dual objectives social outreach. Hence, study aims measure using seconda...

The study investigates the role of financial sector in mobilization oil resources for development Nigerian economy. While period covers between 1981 and 2019, research utilizes principal component analysis (PCA) approach to construct a composite proxy from five variable indicators. Also, deploys fully modified ordinary least squares (FMOLS) estimate impact revenue on Nigeria’s economic growth. ...

Frustration of purpose remains one of the most ill-defined concepts in the English law of contracts. The same problem has recently attracted also the attention of the French legislature in its modernization of the Code Civil. The French reform entitles courts with broad powers to adjust the contract when unforeseen contingencies have made the bargain unduly costly. This article argues that the ...