I derive the optimal choice of public policy, explicitly characterize the optimal rate of endogenous economic growth, and compare it to the competitive growth rate in a two-sector model with ...

This paper analyzes the impact of cyclical volatility on long-term economic growth: does growth increase or decrease with increased cyclical volatility? We construct a stochastic two-sector model of ...

We construct a 2 sector growth model with sector specific technology shocks where one sector produces intermediate goods while the other produces final goods. Theoretical restrictions from this model ...