Economic growth continues to be one of the most active areas in macroeconomics. Early contributions by Robert Solow (Quarterly Journal of Economics, 1956) and Trevor Swan (Economic Record, 1956) laid the foundations for the research that was conducted during the next 15 years or so. Intense research activity continued until the early 1970s, when, because of inflation and oil shocks, interests in macroeconomics were redirected to issues pertaining to short-run macroeconomic stabilization policies. Interest in growth theory was rekindled in 1986 with the contribution by Paul Romer (Journal of Political Economy, 1986) and the development of the so-called endogenous growth model. In contrast to the earlier models in which the steady-state growth rate was tied to the population growth rate and, thus, was essentially exogenous, the long-run growth emerged as an equilibrium outcome, reflecting the behavior of the optimizing agents in the economy. Research in growth theory is continuing and is now much more broadly based than the earlier literature of the 1960s.

This book brings together a number of contributions in growth theory and macroeconomic dynamics that reflect these more recent developments and ongoing debates over the relative merits of neoclassical and endogenous growth models. In so doing, we focus on three areas that have received attention recently. First, we develop a number of growth models that extend the theory in different directions. Second, one concern of the recent literature in growth and dynamics is on the statistical properties of the underlying data and on trying to ensure that the growth models are consistent with the empirical evidence. Third, macrodynamics and growth theory has focused increasingly on international aspects, no doubt a reflection in part of the increasing integration of the world economy.