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This paper introduces a hitherto unpublished 1970 paper written by Lauchlin Currie (1902–1993) on Paul Rosenstein Rodan’s famous 1943 paper on the “Big Push” which led to the balanced-unbalanced growth debate to which Albert Hirschman (1915–2012) was an important contributor. Both Currie and Hirschman had been key economic advisers to the Colombian government, and their respective views on development planning are contrasted. In particular, it is shown how Currie’s 1970 paper illuminates the theory behind the 1971–1974 national plan for Colombia that he prepared and helped deliver; and how the related institutional innovations have had an enduring impact on Colombia’s recent economic history.

Productivity growth in Italy has been persistently anemic and lagged that of the euro area over the period 1999–2015, while the indebtedness of its corporate sector increased. Using the ORBIS firm-level database, this chapter studies the long-term impact of persistent corporate-debt accumulation on the productivity growth of Italian firms, and investigates whether total factor productivity (TFP) growth varies with the level of corporate indebtedness. The authors employ a novel estimation technique proposed by Chudik, Mohaddes, Pesaran, & Raissi (2017) to account for dynamics, bi-directional feedback effects, cross-firm heterogeneity, and cross-sectional dependence arising from unobserved common factors (e.g., oil price shocks, labor and product market frictions, and the stance of the global financial cycle). Filtering out the effects of unobserved common factors and controlling for firm-specific characteristics, the authors find significant negative effects of persistent corporate-debt build-up on firms’ TFP growth on average, and weak evidence of a threshold level of corporate debt, beyond which productivity growth drops off significantly. The results have strong policy implications, for example the design of the tax system should discourage persistent corporate-debt accumulation, and effective and timely frameworks to reduce corporate-debt overhangs are essential.

This paper discusses the role of Albert O. Hirschman as a founder of development economics in the postwar years. Although Hirschman maintained a strong interest in development matters throughout his entire professional career, his major contributions to development economics took place between the mid-1950s and the late 1960s. The paper examines Hirschman’s innovative contributions to the new discipline. When, in the 1950s, development economics gravitated around the concept of “balanced growth,” Hirschman opened new vistas with a theory of “unbalanced growth.” In the early 1960s, Hirschman focused on reformist political approaches to development, against the opposed extremisms of reaction and revolution. Finally, in the late 1960s, Hirschman opened new perspectives on the importance of detailed analysis of development projects, against the theoretical drift of early development economics.

The discussion of Hirschman’s development career is also an opportunity to observe the gap between theoretical debates and development policies. Whereas development economists often clashed on theoretical issues, their views were remarkably closer on practical questions.

As a pioneer of development economics, Hirschman sought to establish it as a discipline theoretically distinct from mainstream economics. By the 1980s, this project had collapsed, and the development question was reabsorbed by the economic mainstream. This article, however, argues that current development debates remain deeply indebted to Hirschman’s contribution. His reformist vision, rejection of one-size-fits-all solutions, his insistence on the ineluctable role of uncertainty, and his search for country-specific, incremental, and evolutionary policies make his approach central to current development discourse.

This article provides a detailed investigation of how Lewis revisited classical and Marxian concepts such as productive/unproductive labor, economic surplus, subsistence wages, reserve army, and capital accumulation in his investigation of economic development. The Lewis 1954 development model is compared to other models advanced at the time by Harrod, Domar, Swan, Kaldor, Solow, von Neumann, Nurkse, Rosenstein-Rodan, Myint, and others. Lewis applied the notion of economic duality to open and closed economies.

The purpose of the paper is to model the human development potentials of democratization, demilitarization, industrialization, and family planning that different developing regions tap and forego.

The authors develop and estimate a human development system that is built around economic, political, and social dimensions and program a system dynamic model to simulate the effects of democratization, demilitarization, industrialization, and family planning.

The findings strongly indicate that the socioeconomic and political development effects associated with industrial development and family planning far outweigh those associated with democratization and demilitarization.

With this study the authors hope to stimulate a discussion with the goal of achieving a better understanding of the economic and political transmission mechanisms of democratization, demilitarization, industrialization, and family planning. To the authors' knowledge, this study is the first to assess these developmental parameters quantitatively in a comparative economic perspective.

International tourism and FDI inflows have generated detectable beneficial impacts on the economy of Estonia in the last decades. However, recently, poor international market conditions mostly caused by the trade war and COVID-19 pandemic have been a potential threat to these two factors. Besides, the poor performance of investments in recent years is behind the stagnation of productivity in Estonia. This study examines the dynamics of the effects of these factors on the rate of economic growth in Estonia and provides policy implications in line with sustained recovery.

A nonlinear ARDL technique is employed in this study to investigate the long-run effects of FDI and the degree of tourism specialization on economic growth rate.

Our findings indicate that the economic growth rate of Estonia in the long run has been positively affected by both the rate of FDI inflows and international tourism.

This is the first study that employs a non-linear approach to investigate the dynamics of long-run effects of FDI and tourism specialization on the rate of economic growth in Estonia and provides policy implications in line with optimal growth strategy considering the economic structure, the current level of productivity and available potentials in this economy.

The objective of this paper is to focus on the evolution of development economics, both as an academic discipline and as a subject taught at both undergraduate and postgraduate levels, at the University of Manchester, from approximately the early‐1950s onwards. It is not a history or survey of development economics per se but concentrates rather on the richness and variety of the contributions made by a number of eminent economists while they were in the Department of Economics (since 1993, the School of Economic Studies), to both the development of theory and to empirical analysis and to policy prescription, and to the teaching of development economics. Only a limited account is given of the work of these economists once they were no longer in Manchester.

Pantaleoni used to say that there are two categories of economists—those who can, in the sense of being able to produce original work, and those who cannot. A more meaningful and more useful distinction can be made between those who reason about the given problems in terms of stable equilibrium (most of them classicists) and those who do their thinking in terms of unstable equilibrium (actually stable disequilibrium) and sheer disequilibrium (most of them modern and contemporary scientists).

The purpose of this study is to investigate the effect of government expenditure on economic growth in 15 Economic Community of West African States (ECOWAS) countries over the period of 2005–2017. More precisely, this paper investigates whether institutional environment influences the effect of government spending on economic growth.

This study adopts the generalized method of moments-system method of estimation to address the problem of dynamic endogeneity inherent in the relationship. Similarly, unlike previous studies which assume that the disturbances of a panel model are cross-sectionally independent, we account for cross-section dependency and cross-country heterogeneity inherent in empirical modeling using Driscoll and Kraay's nonparametric covariance matrix estimator, adjusted for use with both balanced and unbalanced panels along with Monte Carlo simulations.

The authors find that though, government spending has a positive impact on economic growth but the level of institutional quality adversely affect that positive impact. This suggests that the institutional environment in ECOWAS countries is a drag and not a push factor for government fiscal operations and/policies. Thus, the results provide empirical evidence that there is a conditional relationship between government spending and economic growth in African countries. That is, the effect of government spending on economic growth is dependent on the quality of institutions. Lastly, these findings suggest that in order for government spending to contribute to economic growth, African countries must develop a strong institutional environment.

Unlike previous time series studies for African countries which concentrated on the two variable case, we include institutional quality as a third variable to underline the potential importance of institutional quality for economic growth in ECOWAS countries.