Robert E. Hall and Charles I. Jones (1999), Why Do Some Countries Essay

Robert E. Hall and Charles I. Jones (1999), Why Do Some Countries Produce So a great deal More Output per Worker than Others,Quarterly Journal of Economics, 83-116 - Essay ExampleThis diversion away from growth promoting investment takes the form of thievery, unprotected property rightsThe investigation is ground around a hypothesis that these differences in investment in uppercase accumulation is primarily the result of differences in social infrastructure across countries. well-disposed infrastructure, as a concept used in their research, includes a number of ideas such as institutions and government policies, all of which, they claim, contribute to creating an environment in which capital accumulation is encouraged.A social infrastructure favourable to high levels of output per worker provides an environment that supports productive activities and encourages capital accumulation, skill acquisition, invention, and technology transfer. The researchers claim that entry of this f avourable social infrastructure is best done by the government because they have the authority to collect the resources needed to establish the regulations and laws that would create a cloth to stop diversion. However, corrupted government, engaging in rent-seeking behaviour, contribute to the diversion of resources away from activities of capital accumulation by creating poor contracts, interfering in production activities, and impede trade. As such, the paper does indicate that the most appropriate social infrastructure for growth would limit the role of government given governments aptness for rent-seeking behaviour.A major issue that is developed in their research concerns the direction of causality between social infrastructure and output per worker. Hall and Jones admit that more than productive workers, with higher levels of education and income levels, could influence the social infrastructure. As such, countries experiencing low growth levels are unable to provide the r esources necessary to create a substantiating social infrastructure that would encourage further human and physical capital accumulation, meaning that appropriate