The renaissance of economic growth research

Introduction
In 2002 there were 192 internationally recognized independent countries in
the world that included the 191 members of the United Nations plus Taiwan
(Alesina and Spolare, 2003). Among these countries are some that by historical
standards are extremely rich and many more that are relatively poor. Their
size, measured by geographical area, by total population, or by total GDP,
varies enormously. Measured by geographical and population size we observe
large poor countries (India) and large rich countries (USA) as well as
small rich countries (Switzerland) and small poor countries (Sierra Leone).
We also see every other possible combination in between. When we examine
the economic growth performance of these countries we also see a wide
variety of experience, from the high positive rates observed during the last
four decades of the twentieth century among the Asian Tigers (Hong Kong,
South Korea, Singapore, Taiwan) to the negative growth rates experienced in
many sub-Saharan countries during the last couple of decades. Since sustained
economic growth is the most important determinant of living standards,
there is no more important issue challenging the research efforts of economists
than to understand the causes of economic growth. In reviewing the
differential growth performances of countries such as India, Egypt, the ‘Asian
Tigers’, Japan and the USA, and the consequences of these differentials for
living standards, Lucas (1988) observed that ‘the consequences for human
welfare involved in questions like these are simply staggering. Once one
starts to think about them, it is hard to think about anything else’.
In this chapter we review many of the important theoretical, empirical and
political-economy issues relating to modern economic growth and the deter
minants of living standards that have captivated the research interests of both
economists, economic historians and other social scientists during the twentieth
century.