My research interests are in the areas of Comparative Development, Long-Run Growth, Evolutionary Economics, Technological Change and Innovation, Economic Growth and Development, Macroeconomics and Monetary Economics.
Published or Forthcoming
Recent Working Papers
Research In Progress
- Culture, Diffusion, and Economic Development: The Problem of Observational Equivalence, joint with Ani Harutyunyan Economics Letters, 2017, Vol. 158(C):94-100
AbstractThis research explores the direct and barrier effects of culture on economic development. It shows both theoretically and empirically that whenever the technological frontier is at the top or bottom of the world distribution of a cultural value, there exists an observational equivalence between absolute cultural distances and cultural distances relative to the frontier, preventing the identification of its direct and barrier effects. Since the technological frontier usually has the “right” cultural values for development, it tends to be in the extremes of the distribution of cultural traits, generating observational equivalence and confounding the analysis. These results highlight the difficulty of disentangling the direct and barrier effects of culture. The empirical analysis finds suggestive evidence for direct effects of individualism and conformity with hierarchy, and barrier effects of hedonism.
- The Agricultural Origins of Time Preference, joint with Oded Galor American Economic Review, 2016, 106(10):3064–3103 (Working Paper) (CSI Project)(Slides)
AbstractThis research explores the origins of the distribution of time preference across regions. Exploiting a natural experiment associated with the expansion of suitable crops for cultivation in the course of the Columbian Exchange, the research establishes that pre-industrial agro-climatic characteristics that were conducive to higher return to agricultural investment, triggered selection, adaptation and learning processes that have had a persistent positive effect on the prevalence of long-term orientation in the contemporary era. Furthermore, the research establishes that these agro-climatic characteristics have had a culturally-embodied impact on economic behavior such as technological adoption, education, saving, and smoking.Coverage
- Optimal consumption under uncertainty, liquidity constraints, and bounded rationality, Journal of Economic Dynamics and Control, 2014, Vol. 39: 237-254 (Working paper) (code)
AbstractI study how boundedly rational agents can learn a “good” solution to an infinite horizon optimal consumption problem under uncertainty and liquidity constraints. Using an empirically plausible theory of learning I propose a class of adaptive learning algorithms that agents might use to choose a consumption rule. I show that the algorithm always has a globally asymptotically stable consumption rule, which is optimal. Additionally, I present extensions of the model to finite horizon settings, where agents have finite lives and life-cycle income patterns. This provides a simple and parsimonious model of consumption for large agent based models.
- Adaptive Consumption Behavior, joint with Peter Howitt, Journal of Economic Dynamics and Control, 2014, Vol. 39: 37-61 (NBER working paper) (appendix)
AbstractIn this paper we propose and study a theory of adaptive consumption behavior under income uncertainty and liquidity constraints. We assume that consumption is governed by a linear function of wealth, whose coefficients are revised each period by a procedure that places few informational or computational demands on the consumer. We show that under a variety of settings the procedure converges quickly to a set of coefficients with low welfare cost relative to a fully optimal nonlinear consumption function.
- Isolation and Development, joint with Oded Galor and Quamrul Ashraf, Journal of the European Economic Association, April/May 2010, Vol. 8, No. 2-3: 401-412. (data)
AbstractThis paper exploits cross-country variation in the degree of geographical isolation, prior to the advent of sea-faring and airborne transportation technologies, to examine its impact on the course of economic development across the globe. The empirical investigation establishes that prehistoric geographical isolation has generated a persistent beneficial eﬀect on the process of development and contributed to the contemporary variation in the standard of living across countries.
- Optimización y Dinámica, joint with Sergio Monsalve, in Sergio Monsalve (ed.) “Matemáticas básicas para economistas. (Con notas históricas y contextos económicos), No. 3., Editorial Universidad Nacional de Colombia, Bogotá, 2010
- Two-sided Matching Models, joint with Marilda Sotomayor, in R.A. Meyers (ed.) “Encyclopedia of Complexity and Systems Science”, Springer-Verlag, New York 2008.
- Comportamiento Asintótico y Selección de Equilibrios en Juegos Evolutivos, Editorial Universidad Externado de Colombia, Bogotá, 2006
- Equilibrios Múltiples y Tasa Natural de Interés, Academia Colombiana de Ciencias Económicas, Bogotá, 2005
Recent Working Papers
- Geographical Origins and Economic Consequences of Language Structures, joint with Oded Galor and Assaf Sarid
AbstractThis research explores the economic causes and consequences of language structures. It advances the hypothesis and establishes empirically that variations in pre-industrial geographical characteristics that were conducive to higher returns to agricultural investment, gender gaps in agricultural productivity, and the emergence of hierarchical societies, are at the root of existing cross-language variations in the structure of the future tense and the presence of grammatical gender and politeness distinctions. Moreover, the research suggests that while language structures have largely reflected past human experience and ancestral cultural traits, they have independently affected human behavior and economic outcomes.
- The Origins and Long-Run Consequences of the Division of Labor, joint with Emilio Depetris-Chauvin
AbstractThis research explores the historical roots and persistent effects of the division of labor in pre-modern societies. Exploiting a novel ethnic-level dataset, which combines geocoded ethnographic, linguistic and genetic data, it advances the hypothesis and establishes empirically that population diversity had a positive effect on the division of labor, which translated into persistent differences in economic development. Specifically, it establishes that pre-modern economic specialization was conducive to pre-modern statehood, urbanization and social hierarchy. Moreover, it demonstrates that higher levels of pre-modern economic specialization are associated with greater skill-biased occupational heterogeneity, economic complexity and economic development in the contemporary era.
- Population Diversity, Division of Labor and the Emergence of Trade and State, joint with Emilio Depetris-Chauvin
AbstractThis research explores the emergence and prevalence of economic specialization and trade in pre-modern societies. It advances the hypothesis, and establishes empirically that population diversity had a positive causal effect on economic specialization and trade. Based on a novel ethnic level dataset combining geocoded ethnographic and genetic data, this research exploits the exogenous variation in population diversity generated by the “Out-of-Africa” migration of anatomically modern humans to causally establish the positive effect of population diversity on economic specialization and the emergence of trade-related institutions, which, in turn, facilitated the historical formation of states. Additionally, it provides suggestive evidence that regions historically inhabited by pre-modern societies with high levels of economic specialization have a larger occupational heterogeneity and are more developed today.
- Land Productivity and Economic Development: Caloric Suitability vs. Agricultural Suitability, joint with Oded Galor
AbstractThis paper establishes that the Caloric Suitability Index (CSI) dominates the commonly used measure of agricultural suitability in the examination of the effect of land productivity on comparative economic development. The analysis demonstrates that the agricultural suitability index does not capture the large variation in the potential caloric yield across equally suitable land, reflecting the fact that land suitable for agriculture is not necessarily suitable for the most caloric-intensive crops. Hence, in light of the instrumental role played by caloric yield in sustaining and supporting population growth, and given importance of pre-industrial population density for the subsequent course of economic development, the Caloric Suitability Index dominates the conventional measure in capturing the effect of land productivity on pre-colonial population density and the subsequent course of economic development.
- Culture, Diffusion, and Economic Development, joint with Ani Harutyunyan
AbstractThis research explores the effects of culture on technological diffusion and economic development. It shows that culture’s direct effects on development and barrier effects to technological diffusion are, in general, observationally equivalent. In particular, using a large set of measures of cultural values, it establishes empirically that pairwise differences in contemporary development are associated with pairwise cultural differences relative to the technological frontier, only in cases where observational equivalence holds. Additionally, it establishes that differences in cultural traits that are correlated with genetic and linguistic distances are statistically and economically significantly correlated with differences in economic development. These results highlight the difficulty of disentangling the direct and barrier effects of culture, while lending credence to the idea that common ancestry generates persistence and plays a central role in economic development.
- Distance to the Technological Frontier and Economic Development, (appendix) (slides) (data) (under review)
AbstractThis research explores the effects of the geographical distance to the pre-industrial technological frontier on economic development. It establishes theoretically and empirically that there exists a persistent non-monotonic effect of distance to the frontier on development. In particular, exploiting a novel measure of the travel time to the technological frontier and variations in its location during the pre-industrial era, it establishes a robust persistent U-shaped relation between the distance to the pre-industrial technological frontier and economic development. Moreover, it demonstrates that isolation from the frontier has had a positive cumulative effect on innovation and entrepreneurial activity levels, suggesting isolation may have fostered the emergence of a culture conducive to innovation, knowledge creation, and entrepreneurship.
- The Voyage of Homo-œconomicus: some economic measures of distance
Research In Progress
- Leviathan or The Matter, Form and Power of Politeness, joint with Oded Galor and Assaf Sarid
- The Neolithic and Life Expectancy: A Double-Edged Sword, joint with Oded Galor and Rapaël Franck
- State formation, joint with Emilio Depetris-Chauvin
- Culture, Genetics, and Development, joint with Emilio Depetris-Chauvin and Ani Harutyunyan
- The Economic Origins and Consequences of Hierarchy and Power Distance, joint with Oded Galor
- The Neolithic Revolution and Comparative Development, joint with Oded Galor
- Geography, Trade-specific Human Capital and Comparative Development, joint with Stelios Michalopoulos
- Frontiers of Development, joint with Stelios Michalopoulos and Martin Fiszbein
- Reinventing the Wheel: Duplication of Effort, Competition, and Scale Effects in a Schumpeterian Growth Model
- The Sugar and Spice Theory of Economic Growth
- Durable Goods and the Dynamics of Innovation and Adoption of Technology
- Vested Interests, Media Capture and Resistance to Technology Adoption, joint with Ruben Durante
- A Tale of a Thousand Cities, joint with Ruben Durante and David Weil