Conference Agenda

Does the source of Research and Development funding, public or private, matter for productivity growth? Using a novel firm-level dataset with patent and balance-sheet information covering 70 years (1950-2020), I estimate the impact of the decline in public R&D in the US on productivity growth. I use two instrumental variable strategies–a historical shift-share IV and a patent examiner leniency instrument–to estimate the impact of the decline in public R&D on the productivity of firms through technology spillovers. I find that a 1% decline in public R&D spillovers causes a 0.03 to 0.08% decline in firm TFP growth. Public R&D spillovers appear to be two to three times as impactful as private R&D spillovers for firm productivity. Using a calibrated model where corporate tax funds public R&D, I find that the decline in public R&D can explain around a third of the decline in TFP growth in the US.

Artificial Intelligence (AI) is transforming business operations and global markets, yet little is known about how AI investments spill over across borders. Using a novel panel dataset, we examine the international propagation of U.S. firms’ AI investments, focusing on their European subsidiaries and broader industry-level effects. We find that AI investment strongly predicts growth in foreign subsidiaries’ assets, employment, and revenues, with significant spillovers to European industries exposed to U.S. AI firms. However, these effects vary with local tax policies: countries with attractive R&D tax incentives experience faster and larger AI-driven growth, while low corporate tax rates further amplify revenue spillovers. Our findings highlight the role of fiscal policy in shaping the diffusion of AI and offer new insights into how digital-era investments influence global economic growth.

The objective of this article is to show that there is a distorting effect of Cameroon's failing institutional environment on the structure of public expenditure. To study the choices made by public authorities, we rely on a Bayesian model over the period 1970-2020 to determine the occurrence of public investment allocation. It emerges that institutional failure marked by corruption, political and social instability, and approximate compliance with established laws, directs public investment towards types of expenditure for which rent seeking is easier and easily concealed, particularly in physical capital to the detriment of education and health expenditure. In this context, the results also reveal that economic growth is negatively associated with the choice of investing in social projects. Economic policy recommendations are in line with budgetary rebalancing through social investments, which are essential for resolving social crises and improving factor productivity.

This paper studies the relationship between the growth in private capital markets and the rise in economic inequalities in the U.S over the last two decades. First, we document that the share of overall financing raised by early-stage private companies from high-net-worth individuals (HNWIs) tripled from 2004 to 2022. Second, exploiting state-level variation in exposure to the expanded federal capital gains tax exemption on qualified small business stock, we find that the growth in HNWIs’ early-stage investments increased the average income gap between HNWIs and other income earners by 6.0%. Third, we show that this rise in income concentration appears to have been driven by HNWIs’ excess returns on their early-stage investments relative to public stock market returns. Finally, we find that HNWIs’ excess returns on these investments accounted for 11% and 5% of the growth in the top 1% share of income and wealth, from 2010 to 2019.