PRODUCTIVITY GROWTH AND TECHNOLOGICAL DIFFUSION THROUGH FOREIGN DIRECT INVESTMENT

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 has a positive and direct effect on TFP growth. However, we do not find any evidence that the impact of FDI on TFP growth is only conditional on the recipient country's capability to absorb foreign technology. We carefully address the robustness of the empirical results . ( JEL O11, O40, O47, F21)     

RENT‐SEEKING AND CAPITAL ACCUMULATION

A general model incorporating rent‐seeking activities in the standard neoclassical model of capital accumulation is presented. The welfare of the representative agent is negatively affected by the efficiency of rent‐seeking activities. Although intuitive, this result is not obvious because long‐run income can be positively affected by more efficient rent‐seeking activities. The model is used to provide explanations for some recent experiences in developing countries, including the relative poor performance of economies that experience a move to a more decentralized system and the observed path of total factor productivity (TFP) in countries like Ireland and Venezuela. (JEL D23, D74, O40, O41, O47)     

ENTRY BARRIERS,COMPETITION, AND TECHNOLOGY ADOPTION

I build a model of technology adoption to study the quantitative effect of entry barriers on total factor productivity (TFP). In my model, incumbent firms choose technologies that are sufficiently productive to deter entry from a potential competitor. I show that higher entry barriers help to deter entry and lead to the choice of less productive technologies. A novelty of my work is that I use a direct measure of entry barriers. I find that reducing entry barriers from their average level in the poorest 30% of countries to their U.S. level leads to a sizeable increase in aggregate TFP of 12%. (JEL O11, O43)     

LATIN AMERICA'S DECLINING SKILL PREMIUM: A MACROECONOMIC ANALYSIS

The decline in Latin America's skill premium and income inequality during the 2000s was partly driven by an economic expansion that favored low‐skill‐intensive service sectors. Evidence shows inequality becomes countercyclical in the 2000s, and unlike previous expansions, the boom was concentrated on services while manufacturing lagged behind. I build an open economy general equilibrium model that features a low‐skill‐intensive nontradable sector. The model suggests that favorable shocks to commodity prices and international interest rate spreads, such as those that buffeted Latin America in the 2000s, account for about a fifth of the observed decline in the skill premium. (JEL D31, E32, F41, O15, O54)     

DYNASTIC MANAGEMENT

The most striking difference in corporate‐governance arrangements between rich and poor countries is that the latter rely much more heavily on the dynastic family firm, where ownership and control are passed on from one generation to the other. We argue that if the heir to the family firm has no talent for managerial decision making, dynastic management is a failure of meritocracy that reduces a firm's total factor productivity (TFP). We present a simple model that studies the macroeconomic causes and consequences of dynastic management. In our model, the incidence of dynastic management depends, among other factors, on the imperfections of contractual enforcement. A plausible calibration suggests that, via dynastic management, poor contract enforcement may be a substantial contributor to observed cross‐country differences in aggregate TFP. (JEL O43, O47, G32)     

Popular incorporation and prospects for democracy

Conclusion It has become commonplace to observe that Brazilian politics has undergone little change in recent years. Political society remains conservative, elitist, and dominated by amorphous and fluid political coalitions maneuvering for access to power. At first sight, it appears that dramatic transformations in the economic and social fabric of Brazilian society have had little or no effect on the way the political processes are conducted. One reason for this is the apparent willingness of the popular classes to participate in political arrangements that secure the hegemony of traditional elites. As I have shown, however, the various forms of collective organization that surfaced in protest of the military in the late 1970s are capable of breaking this spell. In providing vehicles of interest representation that militate against the logic of incorporative, patronage-based politics, these organizations make an important contribution toward the reconstitution of civil society along class lines. The accomplishment of this task is essential if the Left is to resolve the tension between ideological purity and electoral success.This tension is not specific to the Brazilian case. The legacies of dependent capitalist development common to most of Latin America have created conditions upon which both clientelist and populist politics thrive. And if there was a sudden spate of authoritarian reactions to economic and political crises in the region in the 1960s and 1970s, this interlude has been followed, predictably, by the reemergence en masse of populist-based political movements. Many of these movements - Aprismo in Peru, Peronismo in Argentina, and Brizolismo in Brazil - are the direct descendants of their pre-authoritarian counterparts. They are all trapped because of the inconsistency of their political bases by the contradiction between distributive politics and economic solvency.Most recent transitions from authoritarian rule were also, however, accompanied by the emergence and eventual demise of a popular movement. The thesis presented here suggests that if these movements played only a limited role in the actual process of transition, they may well determine the form that post-authoritarian politics takes in such countries.     

THE AGRICULTURAL PRODUCTIVITY GAP IN EUROPE

For 15 European countries over the 1970–2004 period we find large and persistent agricultural productivity gaps, the ratio of value added per hour in nonagriculture to that in agriculture. Comparing the gap in value added per hour to the wage gap between the two sectors suggests that value added in the data is mismeasured. We further find that, controlling for differences in gross domestic product per capita and institutions, the mismeasurement is positively related to self‐employed share of hours in agriculture. Correcting for underreporting of self‐employment income using our preferred correction factor reduces the measured agricultural productivity gap by 38%. These findings suggest that underreporting can account for a significant portion of the measured agricultural productivity gap. (JEL E01, O47, O52, Q10)     

HOW IMPORTANT ARE CAPITAL AND TOTAL FACTOR PRODUCTIVITY FOR ECONOMIC GROWTH?

We examine the relative importance of the growth of physical and human capital and the growth of total factor productivity (TFP) using newly organized data on 145 countries that spans more than 100 years for 23 of these countries. For all countries, only 14% of average output growth per worker is associated with TFP growth. We use priors from theories to construct estimates of the relative importance of the variances of aggregate input growth and TFP growth across countries. Much of the importance of the variance of TFP growth across countries is associated with negative TFP growth. (JEL O47 , O50 , O57 , O30 , N10 )     

Latin American Identity Politics: Redefining Citizenship

Identity‐based social movements and politics have played an important role in Latin America since the 1970s and continue to do so today. In this essay, I argue that this form of politics – as it has taken shape across Latin America – has been defined by its intersectionality. I trace the ways in which neoliberalism has facilitated a certain kind of identity politics while limiting more radical political claims. I argue that identity politics have contributed to the current “pink tide” sweeping across the continent and are in continual dialogue with these new leftist governments as they redefine what it means to be citizen and what the relationship between state and citizen should be.     

THE HETEROGENEITY OF IMMIGRANTS,HOST COUNTRIES' INCOME AND PRODUCTIVITY: A CHANNEL ACCOUNTING APPROACH

This article exploits changes in the distribution of immigrants across 20 Organization for Economic Co‐operation and Development countries from 1960 to 2005 in order to assess their contribution to income of destination countries. The non‐random sorting of immigrants across countries is addressed by using an instrumental variable strategy. The instrument is built by estimating a bilateral migration model incorporating exogenous origin country determinants of migration. Aggregate results reveal that immigrants have a positive effect on income that works primarily through total factor productivity (TFP). We further construct a novel dataset from censuses and labor force surveys to explore the information on the age of immigrants. Contrasting income effects are found across age groups: a higher share of immigrants among the youth has a negative impact on aggregate income, while a higher share of immigrants among prime‐aged workers has a positive effect. We interpret this disparity as short‐term versus medium‐term effects. Adjustments over time involve changes in TFP but also in the human capital of the native‐born. (JEL F22, J24, J31, O31)     

DISCONTINUITY OF OUTPUT CONVERGENCE WITHIN THE UNITED STATES: WHY HAS THE COURSE CHANGED?

Has the progress of output convergence changed within the United States? This article examines the output convergence among U.S. states for the last five decades by making several improvements over the extant literature. By applying a battery of convergence tests designed to capture nonlinear transitional dynamics to real output per worker data (i.e., nominal values deflated by state‐level price), we find that output convergence has not been a feature of the continental United States since the 1970s. Instead, output convergence has proceeded among four subgroups within which constituent states have certain characteristics in common. Our regression analysis suggests that state‐level characteristics related to technology and human capital play a crucial role in accounting for the formation and composition of convergence clubs, in agreement with the recent theoretical models of growth and development (e.g., Aghion et al. 2009; Gennaioli et al. 2013b). The level of technology, proxied by patents, turns out to be a consistently significant determinant even after controlling for endogeneity, suggesting that frictions in the diffusion of technology and human capital may have led to clustering of states with different levels of productivity. Our results therefore cast doubt on the common view that diffusion of knowledge and technology across state borders is frictionless. (JEL O47, O51)     

INTERNATIONAL R&D SPILLOVERS AND PRODUCTIVITY TRENDS IN THE ASIAN MIRACLE ECONOMIES

This paper examines the importance of the domestic research and development stock and foreign knowledge spillovers on total factor productivity for six Asian miracle economies over the period from 1955 to 2006. The productivity effects of international knowledge spillovers through the following channels are considered: imports, exports, inward foreign direct investment, patents, geographical proximity, and the general channel. The general channel is a transmission mechanism where knowledge spillovers occur automatically and do not pass through any specific channel. The estimates show that knowledge has been transmitted through all the channels considered but that the import channel and the general channel have probably been the most important ones for the Asian miracle economies. (JEL O10, O30, O40)     

Hybridizing the canon: Russian-American writers in dialogue with Russian literature

Since the beginning of the twenty-first century, Russian-American writers – that is, Russian-speaking Jews who immigrated to North America from the late 1970s to the early 1990s – have garnered both a wide readership and critical acclaim. Although they live in the United States and write in English, their works manifest a marked focus on Russian-related themes, including the frequent employment of Russian literature. Three Russian-American texts engage in sustained intertextual play: Irina Reyn’s What Happened to Anna K. with Lev Tolstoi’s Anna Karenina; Lara Vapnyar’s Memoirs of a Muse with the diary of Fedor Dostoevskii’s mistress, Polina Suslova; and Anya Ulinich’s Petropolis with Osip Mandel’shtam’s poem “Na strashnoi vysote bluzhdaiushchii ogon'” (“At a terrifying height a wandering fire”). This article has two interrelated aims. The first is to demonstrate that, similar to postcolonial and other diasporic writers, Russian-American writers’ intertextual use is inextricably linked with a negotiation of cultural identities. The second is to offer a close analysis of the ways in which Reyn’s What Happened to Anna K., Vapnyar’s Memoirs of a Muse, and Ulinich’s Petropolis recast Russian texts as Russian-American elaborations of cultural hybridity and immigrant sensibility.     

Research on international migration and census data co-operation in Latin America

Population censuses in Latin America have generally recorded the place of birth of all persons enumerated. The use of those data for the study of international migration has been less common because international movements were judged to be a relatively weak factor determining demographic change in the majority of Latin American countries and because the data gathered were generally not tabulated with sufficient detail. During the 1970s, the UN Latin American Demographic Center (CELADE) realized that international migration was not necessarily a minor factor in their evolution and launched a program to improve the quality and availability of census information on the foreign-born population enumerated by each country. The program on International Migration in Latin America (IMILA) has therefore been in operation for more than 10 years and has been successful in eliciting the in-depth tabulation and exploitation of census information in the majority of Latin American countries and in the 2 main receivers in the Americas: Canada and the US. As part of the IMILA project, CELADE has become the depository of magnetic tapes with census information on the foreign-born population, thus gaining greater flexibility in the exploitation of the data available. On the basis of the information gathered, CELADE has published twice in the past decade a compilation of tabulations of the foreign-born population by country of enumeration, country of birth, age, and sex. Although census data on place of birth are not free from problems, particularly in countries where illegal migrants may not be adequately enumerated by a census, they are a valuable source of reasonably comparable information on the overall impact of migration in receiving countries and are often the only source of information on emigration from the sending countries.     

‘Ch'us mon propre Bescherelle’: Challenges from the Hip‐Hop nation to the Quebec nation1

We examine the uses of and attitudes towards language of members of the Montreal Hip‐Hop community in relation to Quebec language‐in‐education policies. These policies, implemented in the 1970s, have ensured that French has become the common public language of an ethnically diverse young adult population in Montreal. We argue, using Blommaert's (2005) model of orders of indexicality, that the dominant language hierarchy orders established by government policy have been both flattened and reordered by members of the Montreal Hip‐Hop community, whose multilingual lyrics insist: (1) that while French is the lingua franca, it is a much more inclusive category which includes ‘Bad French,’ regional and class dialects, and European French; and (2) that all languages spoken by community members are valuable as linguistic resources for creativity and communication with multiple audiences. We draw from a database which includes interviews with and lyrics from rappers of Haitian, Latin‐American, African‐American and Québécois origin.     

Governability and Women's Citizenship

SUMMARY

The fragility of Latin American democracies places the subject of gendered citizenship as an important issue in the context of a most needed democratic governability. This article first develops a proposed nexus between democratic governability and gender equality and assumes the need to place women within a universe of citizenship, as an inherently inclusive democratic perspective would require. We emphasize what we see as women's citizenship deficit according to a traditional definition of the political. The second part of the article analyzes the insertion of Mexican women in the construction of citizenship on the basis of empirical material drawn from the second National Survey on Political Culture and Practice of Citizenship. We then present some conclusions, with an eye on what Victoria Camps has called the public virtues, such as solidarity, responsibility and tolerance, as democratic values of the first order and as characteristics of a gendered citizenship within new political spaces. We believe the fragile democracies of Latin America and the important quality of democratic governability can be strengthened if a new form of gendered citizenship, more inclusive of women's concerns and practices, is recognized and nurtured.     

GROWTH AND CONVERGENCE WHEN TECHNOLOGY AND HUMAN CAPITAL ARE COMPLEMENTS

This article presents a model of endogenous growth, in which a firm's technology and a country's human capital stock are complementary in the production of output. Production technologies are created by costly research and development (R&D) and are owned by firms that can freely choose where in the world to produce. Both production and R&D have a positive effect on a country's human capital stock. While all countries typically grow at the same rate in the long run, they differ in their levels of human capital, per capita output, and the quality of the technologies that are used in production. A country's relative position in terms of productivity is history dependent. Countries that start out with a lower human capital stock or industrialize later end up with a lower per capita GDP in long‐term equilibrium. (JEL O4, O33, O47)     

States,elites, and inequality in Latin America

In this article, I review the literature on elites and inequality in Latin America with a focus on the emergence of uneven state structures and how they came to foster the needs of elites for protection. States in Latin America are traditionally thought of as facilitating processes of top‐down modernization that transformed traditional agrarian economies into complex urban polities, while maintaining extreme inequality. The state is thus central in the genealogy of inequality and elite privilege in Latin America. The synergy between states and elites continues to mark Latin American societies, and it helps us to understand how major economic and political changes occur without significant changes in inequality. For the most part, Latin America's current uneven states emerged as the result of exclusionary projects of citizenship during the first half of the 20th century and were advanced by the advent of repressive regimes during the 1960s and 1970s. After democratic transitions during the 1980s and 1990s, Latin American states came to be characterized, on the one hand, by procedural democratic institutions and on the other, by high levels of state violence, exclusion, and segmented citizenship. The present situation is one of a problematic equilibrium between states, elites, and inequality.     

PUBLIC SPENDING REALLOCATIONS AND ECONOMIC GROWTH ACROSS DIFFERENT INCOME LEVELS

This article examines the effects of public spending reallocations on economic growth. Assembling a disaggregated public spending dataset of 83 countries over the 1970–2011 period, we show that spending reallocations toward education, from health and social protection, have significant growth‐promoting effects across a wide range of countries' income levels. However, income heterogeneity matters, particularly when reallocations involve infrastructure spending. Specifically, a reallocation from this spending to education also promotes growth, albeit primarily when a country's income level is low. This occurs because the effects of infrastructure spending are particularly weak in low‐income countries, possibly due to the low quality of governance. (JEL O43, H50, O11)     

MORE MORTGAGES,LOWER GROWTH?

In newly collected data on 46 economies over 1990–2011, we show that financial development since 1990 was mostly due to growth in credit to real estate and other asset markets, which has a negative growth coefficient. We also distinguish between growth effects of stocks and flows of credit. We find positive growth effects for credit flows to nonfinancial business but not for mortgage and other asset market credit flows. By accounting for the composition of credit stocks and for the effect of credit flows, we explain the insignificant or negative growth effects of financial development in recent times. What was true in the 1960s, 1970s, and 1980s when the field of empirical credit‐growth studies blossomed, is no longer true in the 1990s and 2000s. New bank lending is not primarily to nonfinancial business and financial development may no longer be good for growth. These trends predate the 2008 crisis. They prompt a rethink of the role of banks in the process of economic growth. (JEL E44, O16, O40, C33)