Barriers to riches

Why isn't the whole world as rich as the United States? Conventional views holds that differences in the share of output invested by countries account for this disparity. Not so, say Stephen Parente and Edward Prescott. In Barriers to Riches, Parente and Prescott argue that differences in Total Factor Productivity (TFP) explain this phenomenon. These differences exist because some countries erect barriers to the efficient use of readily available technology. The purpose of these barriers is to protect industry insiders with vested interests in current production processes from outside competition. Were this protection stopped, rapid TFP growth would follow in the poor countries, and the whole world would soon be rich. Barriers to Riches reflects a decade of research by the authors on this question. Like other books on the subject, it makes use of historical examples and industry studies to illuminate potential explanations for income differences. Unlike these other books, however, it uses aggregate data and general equilibrium models to evaluate the plausibility of alternative explanations. The result of this approach is the most complete and coherent treatment of the subject to date.

[1]  D. Gollin.  Getting Income Shares Right , 2002, Journal of Political Economy.

[2]  Public Policy, Price Distortions, and Investment Rates , 1999 .

[3]  C. I. Jones,et al.  Why Do Some Countries Produce so Much More Output Per Worker than Others? , 1998 .

[4]  Peter J. Klenow,et al.  Does Schooling Cause Growth or the Other Way Around? , 1998 .

[5]  Lance Lochner,et al.  Explaining Rising Wage Inequality: Explorations with a Dynamic General Equilibrium Model of Labor Earnings with Heterogeneous Agents , 1998 .

[6]  C. Mulligan.  Substitution over Time: Another Look at Life-Cycle Labor Supply , 1998, NBER Macroeconomics Annual.

[7]  Edward C. Prescott,et al.  Needed: a theory of total factor productivity , 1998 .

[8]  Peter J. Klenow,et al.  Economic growth: A review essay , 1997 .

[9]  Robert Summers,et al.  International Price and Quantity Comparisons: Potentials and Pitfalls , 1996 .

[10]  Boyan Jovanovic.  Learning and Growth , 1995 .

[11]  Thomas J. Holmes,et al.  Resistance to new technology and trade between areas , 1995 .

[12]  C. I. Jones,et al.  Economic growth and the relative price of capital , 1994 .

[13]  Peter J. Klenow,et al.  Learning-by-Doing Spillovers in the Semiconductor Industry , 1994, Journal of Political Economy.

[14]  Stephen L. Parente.  Technology adoption, learning-by-doing, and economic growth , 1994 .

[15]  J. Mincer.  Investment in U.S. Education and Training , 1994 .

[16]  The Perils of Lifetime Employment Systems: Productivity Advance in the Indian and Japanese Textile Industries, 1920–1938 , 1994 .

[17]  Alwyn Young,et al.  The Tyranny of Numbers: Confronting the Statistical Realities of the East Asian Growth Experience , 1994 .

[18]  Patrick J. Kehoe,et al.  Optimal Fiscal Policy in a Business Cycle Model , 1993, Journal of Political Economy.

[19]  J. Adam.  Economics and World History: Myths and Paradoxes , 1994 .

[20]  W. Easterly.  How much do distortions affect growth , 1993 .

[21]  Stephen L. Parente,et al.  Changes in the wealth of nations , 1993 .

[22]  A. Maddison,et al.  Dynamic Forces In Capitalist Development: A Long-Run Comparative View By Angus Maddison , 1992 .

[23]  S. D. Chapman,et al.  Before the Luddites: Custom, Community and Machinery in the English Wollen Industry, 1776-1809. , 1992 .

[24]  Per Krusell,et al.  Macroeconomic Implications of Investment-Specific Technological Change , 1992 .

[25]  G. Grossman,et al.  Innovation and growth in the global economy , 1993 .

[26]  S. Rebelo,et al.  Long-Run Policy Analysis and Long-Run Growth , 1990, Journal of Political Economy.

[27]  L. Cowan.  Privatization in the Developing World , 1990 .

[28]  P. Romer.  Endogenous Technological Change , 1989, Journal of Political Economy.

[29]  J. A. Schmitz,et al.  Imitation, Entrepreneurship, and Long-Run Growth , 1989, Journal of Political Economy.

[30]  H. D. Soto.  The Other Path: The Invisible Revolution in the Third World , 1989 .

[31]  Gary E. Weir,et al.  The Department of Energy , 1989 .

[32]  Edward C. Prescott,et al.  The Firm and the Plant in General Equilibrium , 1989 .

[33]  R. Lucas.  On the Mechanics of Economic Development , 1988 .

[34]  Robert Summers,et al.  A NEW SET OF INTERNATIONAL COMPARISONS OF REAL PRODUCT AND PRICE LEVELS ESTIMATES FOR 130 COUNTRIES, 1950–1985 , 1988 .

[35]  Laurence J. Kotlikoff,et al.  Dynamic Fiscal Policy , 1988 .

[36]  Gregory Clark,et al.  Why Isn't the Whole World Developed? Lessons from the Cotton Mills , 1987, The Journal of Economic History.

[37]  Keith Marsden.  Private Enterprise in Africa: Creating a Better Environment , 1987 .

[38]  N. Rosenberg,et al.  How the West Grew Rich: The Economic Transforma-tion of the Industrial World , 1987 .

[39]  F. Gardner.  How the West grew rich: the economic transformation of the industrial world , 1986 .

[40]  D. Jorgenson,et al.  Tax Policy and Capital Allocation , 1986 .

[41]  J. Boyd,et al.  Dynamic coalitions, growth, and the firm , 1986 .

[42]  Sydney Gregory.  Inside the black box: technology and economics: Rosenberg, N Cambridge University Press, Cambridge, UK (1982) 304pp , 1985 .

[43]  I. Kravis.  World product and income : international comparisons of real gross product , 1983 .

[44]  J. Shoven,et al.  Applied General Equilibrium Models of Taxation and International Trade , 1983 .

[45]  Nathan Rosenberg,et al.  Inside the black box , 1983 .

[46]  J. Laitner.  Monopoly and Long-Run Capital Accumulation , 1982 .

[47]  D. Mueller,et al.  The social costs of monopoly power , 1978 .

[48]  Andreu Mas-Colell,et al.  A model of equilibrium with differentiated commodities , 1975 .

[49]  S. Rosen.  Hedonic Prices and Implicit Markets: Product Differentiation in Pure Competition , 1974, Journal of Political Economy.

[50]  R. Summers.  INTERNATIONAL PRICE COMPARISONS BASED UPON INCOMPLETE DATA , 1973 .

[51]  A. Bergson.  On Monopoly Welfare Losses , 1973 .

[52]  D. Kamerschen.  AN ESTIMATION OF THE “WELFARE LOSSES” FROM MONOPOLY IN THE AMERICAN ECONOMY , 1966 .

[53]  R. Hartwell.  Markets, Technology, and the Structure of Enterprise in the Development of the Eleventh-Century Chinese Iron and Steel Industry , 1966, The Journal of Economic History.

[54]  R. Solow.  TECHNICAL CHANGE AND THE AGGREGATE PRODUCTION FUNCTION , 1957 .

[55]  Arnold C. Harberger.  Monopoly and Resource Allocation , 1954 .