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Journal Article
An Elementary Model of VC Financing and Growth
This article uses an endogenous growth model to study how the improvements in financing for innovative start-ups brought by venture capital (VC) affect firm innovation and growth. Partial equilibrium results show how lending contracts change as financing efficiency improves, while general equilibrium results show that better screening and development of projects by VC investors leads to higher aggregate productivity growth.
Working Paper
From Population Growth to TFP Growth
Using a firm-dynamics model that has been extended to include endogenous growth, we examine how population growth influences total factor productivity (TFP) growth. The most important theoretical result is that the growth rate of surviving old businesses is a "sufficient statistic" to determine the direction and the magnitude of the impact of population growth on TFP growth. Following that, the model is calibrated for Japan and the United States. The main finding of examining balanced growth paths (BGPs) with various rates of population growth is that the effect on TFP growth is sizable. ...
Working Paper
From Population Growth to TFP Growth
A slowdown in population growth causes a decline in business dynamism by increasing the share of old businesses. But how does it affect productivity growth? We answer this question by extending a standard firm dynamics model to include endogenous productivity growth. Theoretically, the growth rate of the size of surviving old businesses is a “sufficient statistic" for determining the direction and magnitude of the impact of population growth on TFP growth. Quantitatively, this effect is significant across balanced growth paths for the United States and Japan. TFP growth in the United States ...
Working Paper
An Elementary Model of VC Financing and Growth
This article uses an endogenous growth model to study how the improvements in financing for innovative start-ups brought by venture capital (VC) affect firm innovation and growth. Partial equilibrium results show how lending contracts change as financing efficiency improves, while general equilibrium results demonstrate that better screening and development of projects by VC investors leads to higher aggregate productivity growth.
Working Paper
From Population Growth to TFP Growth
Using a firm-dynamics model that has been extended to include endogenous growth, we examine how population growth influences total factor productivity (TFP) growth. The most important theoretical result is that the shape of a business's productivity life-cycle profile determines the direction of the impact of population growth on TFP growth. Following that, the model is calibrated for Japan and the United States. The main finding of examining balanced growth paths (BGPs) with various rates of population growth is that the effect on TFP growth is sizable. Japan's expected decline in population ...