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Cited by 445

The DOI matches its Crossref record; 4 of the 4 references it cites were found in a registry or an index.

Intermediate Goods and Weak Links in the Theory of Economic Development

Jones, Charles I·2011·American Economic Journal: Macroeconomics

Abstract

What explains the enormous differences in incomes across countries? This paper returns to two old ideas: linkages and complementarity. First, linkages between firms through intermediate goods deliver a multiplier similar to the one associated with capital in a neoclassical growth model. Because the intermediate goods share of output is about one-half, this multiplier is substantial. Second, just as a chain is only as strong as its weakest link, problems along a production chain can sharply reduce output under complementarity. These forces considerably amplify distortions to the allocation of resources, bringing us closer to understanding large income differences across countries.(JEL: D57, E23, O1O, O47)

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Metadata

Authors
Jones, C. I.
Venue
American Economic Journal: Macroeconomics
Published
2011-04-01
Volume
3
Issue
2
Pages
1-28
ISSN
  • 1945-7707 (ISSN-L)
  • 1945-7715
OpenAlex
W2141982717
Cited by
445
References
4
FWCI
78.89
Type
journal article
Language
en
Open access
closed

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