Essays on productivity, regime changes and economic *growth

The three essays contained in this dissertation all attempt to answer questions about economic growth. These questions, while related in broad sense are quite distinct and each is approached using different techniques.;The first essay compares two explanations for differences in total factor productivity (TFP); one that relies on the existence of appropriate technologies and argues that rich countries invent technologies that are compatible only with their specific factor endowments, and another which argues that technologies are not adopted by poor countries, or that they are used inefficiently. The main result is that inefficiency accounts for most of the differences in TFP and income levels across countries: poor countries have low TFP because they use technologies inefficiently or fail to adopt them. There is also evidence of some differences in available technology and as well as technological divergence.;The second essay attempts to look at the cross country data on economic growth in a novel way. Most recent economic growth research has been aimed at explaining differences in average growth rates. This essay builds on Lant Pritchett's (2001) observation that a country's growth experience over time can be thought of as changes between regimes. I use a time series techniques of Markov-switching regression to characterize growth regimes and the transitions between them. The results indicate that low average growth rates are a result of countries spending more time in low-growth regimes rather then being incapable of fast growth at all. There exists a regime with absolute convergence, however it is not persistent in poor countries. By highlighting the importance of changes in the growth process, the switching model brings attention to the relationship between the short and long run economic performance.;The last essay builds a theoretical model of economic development in a primitive society, which incorporates a simple social interaction. In the model incentives to share output shape the development path and may evolve endogenously over time leading a society out of the stagnant equilibrium. Although simple, the model suggests the potential of social arrangements and nonstandard preferences in contributing to our understanding of the process of development.