Download A Macat Analysis of Robert E. Lucas Jr.'s Why Doesn't Capital Flow from Rich to Poor Countries? AudioBook Free
Because the potential returns seem to be increased in poorer countries than in the developed world, modern monetary theory implies that rich countries should continually spend money on poor countries until dividends balance out. In reality, this won't happen. Economist Robert E. Lucas Jr. asks why in his groundbreaking 1990 article, "Why Doesn't Capital Circulation from Rich to Low of the Countries?" The question is becoming known as the Lucas paradox. Lucas analyzes this, focusing especially on the role of human capital - the skill and experience that people bring with their work. Lucas, a teacher at the School of Chicago, received the Nobel Reward in Economics in 1995 for unrelated research almost two decades earlier. However the Lucas paradox may be his prolonged legacy, important not only to economists, but to anyone thinking about understanding how monetary development works in poorer countries.
